Mitchells & Butlers PLC (LSE:MAB), the pubs, bars and restaurants group, said sales for the year were down 1.3% year on year and warned that energy costs would nearly double in the current year with further increases seen in 2023.
The group said recent moves to support business through the energy crisis were welcome but forecast that total energy and utility costs would still rise to around £150mln from £80mln this year.
Inflationary cost pressures are now evident throughout most of the supply chain, it added.
The group, which runs Toby Carvery, All Bar One and Browns, said quarter four sales were up 1.5% compared to 2019 (pre-Covid) with the improvement coming despite the impact of extreme heat as well as further rail strikes, both of which disrupted trade..
Sales over the August bank holiday were encouraging, with like-for-like growth over the three-day weekend of over 6%, before returning to levels consistent with the quarter as a whole.
The group currently has cash balances of around £160mln, in addition to undrawn committed unsecured facilities of £150mln.
Phil Urban, chief executive, commented: “The trading environment for the hospitality sector remains very challenging, with cost inflation putting increasing pressure on margins” but added: “Our diverse portfolio of well-known brands and strong estate locations, put us in a stronger competitive position to face the challenges ahead."