Analysts at UK stockbroker Shore Capital see Mitchells & Butlers PLC (LSE:MAB) third quarter as “a very encouraging performance”, whilst repeating a ‘Buy’ recommendation and ‘nudging’ up its forecasts.
“MABs has issued a strong trading update for the 42 weeks ended 19 July, which, as expected, has seen an acceleration in trading from the interim stage,” analyst Greg Johnson said about this morning’s update.
“We see this as a very encouraging performance, comfortably ahead of a pub market which continues to demonstrate resilience in a challenging consumer environment.”
Shore Cap now moves up its forecasted annual operating profit by 3% to £325 million, which it highlighted was at the top end of current City consensus.
Earlier today, MABs reported like-for-like sales rising 5% in the quarter as Brits headed out for food and drinks.
That’s helped the pub and restaurant giant lift year-to-date sales growth to 4.5%, ahead of the wider market.
Chief executive Phil Urban said the group was more than holding its own: “The business continues to perform strongly, enabling us to meet the cost challenges facing the sector with confidence.”
Sales of both food and drink were up, helped by good weather and a well-timed Easter boost. M&B has also been busy on the investment front – it’s revamped 150 pubs and restaurants so far this year and rolled out energy-saving upgrades like solar panels and smart sensors. Two new sites have opened their doors, and the group has snapped up the freehold of two others.
With sales steaming ahead and cost pressures in check, M&B now expects full-year results to come in at the top end of expectations.