TRADING UP

Mitchells & Butlers, the pubs and restaurant giant behind the All Bar One, Browns and Harvester chains, is looking to squeeze more cash out of its customers after margins came under pressure from the Brexit-hit pound and soaring wage costs.

Results yesterday revealed that profits fell almost 10 per cent to £75 million in the six months to the end of April, despite a number of measures put in place to mitigate the effects of rising inflation.

Phil Urban, chief executive of M&B, which also owns scores of popular watering holes including Edinburgh’s historic Deacon Brodie’s Tavern, said: “Margins have been adversely impacted by increased costs, most notably from wage inflation, property costs and exchange rate movements.

“In order to partially mitigate these costs we have been working hard to encourage our guests to trade up and increase spend per head for a more premium experience whilst challenging our general managers to run their businesses as cost effectively as possible.”

0 Mitchells & Butlers’ estate includes Edinburgh’s Deacon Brodie’s Tavern

PHIL URBAN, M&B CEO

The group noted that wholesale food prices jumped by 6 per cent in March and said that it has carried out “some price adjustments”, including increases and reductions, as a result.

Like-for-like sales were up by 1.6 per cent in the period, with overall revenues growing 2.4 per cent to more than £1.1 billion.

First-half operating profit slipped to £145m from £157m a year earlier, while an interim shareholder dividend of 2.5p was declared, unchanged on the same period in 2016. Urban added: “Overall, we are pleased with the turnaround in our sales trajectory and relative performance against the market.

“In a challenging cost and consumer environment we will continue to focus on our three priority areas.”

M&B is in the process of overhauling its pub estate, targetingmoreupmarketbrands. The group has launched Sizzling Pizza & Carvery and Sizzling Pub & Grill in an attempt to fight back against new competition

“Wehavebeenworking hard to encourage our guests to trade up and increase spend per head for a more premium experience”