Mitchells and Butlers swings to £121m loss

Mitchells and Butlers sales fell by 12.4% to £1.04bn in the half-year ended 11 April, while adjusted operating profit was £108m, down from £151m the year prior.

In light of the pandemic and consequent lockdown, the group fell to a pre-tax loss of £121m.

The group also made an operating loss of £51m, down from an operating profit of £140m recorded the year prior. 

Nonetheless, the pub operator said that it remained “consistently ahead of the market” before lockdown closures, with a like-for-like sales growth of 0.9% before it closed its estate in March. 

In its latest trading update, the pub operator also said that its unsecured committed financing facilities have been extended by £100m to £250m to 31 December 2021.

The group currently has a net debt of £2.2bn, including £543m of lease liabilities, though its cash flow has more than doubled in the period, rising from £23m to £58m. 

A full property valuation and impairment review resulted in an overall decrease in book value of £524m, though the group still plans to invest £82m into its sites, including two new site openings and 166 conversions and remodels.

Phil Urban, chief executive, said: “The business was performing very well before the enforced closure in response to Covid-19, building on the strengths of our estate of mainly freehold properties, our diversified and well-loved brands and our team’s industry leading operational skills. 

“These assets, coupled with our early experience of re-opening in Germany, give us a clear plan for re-opening and ensure that we are well placed to continue to bring people and communities together and to keep Mitchells & Butlers at the forefront of the eating and drinking-out market.”