A branch of All Bar One whose owners Mitchells and Butlers have returned to profit (M&B/PA)
(Picture: PA Media)Fresh signs of hope emerged for the embattled pub trade today as one of the industry’s biggest names said it was back in profit after a revival in trade and increasingly optimistic about the future.
Mitchells and Butlers, which operates dozens of All Bar One and O’Neill’s pubs across London, posted pre-tax profits of £8 million for the year to September, compared with last year’s loss of £42 million, while sales more than doubled to £2.2 billion.
M&B boss Phil Urban said: “We’ve seen the city centre recover and wet-led businesses recover [and] we’re cautiously optimistic that people cut back on other things before they cut back on going to the pub.”
The pub industry has warned of closures of up to 50 pubs per month, with pub chain J D Wetherspoon saying in September it was putting 32 sites up for sale, including nine in London as it battled soaring food and labour costs.
But Urban said he had no plans to sell off M&B pubs and instead would be willing to consider snapping up others that went up for sale, adding: “We’ll be opportunistic if the right price came up.”
M&B’s share price jumped 7.2% to 152p.
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said: “Mitchells and Butlers results demonstrate the highly volatile time pubs have been experiencing as the urge to socialise post-pandemic has snapped back, just as inflation has been eating away at margins.
“The company has done a valiant job pushing up sales, indicating that pub-goers are still ringfencing budgets for going out at its All Bar One, Harvester and Toby Carvery venues.”
However, Urban warned utility and food costs were “still far higher than they were pre-Covid”, adding: “Whereas historically we could swap out expensive items on the menu, pretty much every category is expensive now.”
The CEO of the Birmingham-based business said the firm had put pint prices up by 5%, around double a typical price rise but lower than inflation rates. The average pint price at a Mitchell and Butlers pub in London is now £5.77, according to an Evening Standard analysis comparing 16 venues in the capital.
There were also glimmers of hope for beleaguered subscription service Naked Wines today, as it said it had revised its borrowing terms to supply it with enough resources to continue to operate comfortably for at least the next 12 months. The firm’s future had been in serious doubt, and in September it warned it was considering its options for the next 18 months, sending shares plunging.
Naked fell to a pre-tax loss of £215,000 in first six months of the year, against a £1.3 million profit a year ago.Boss Nick Devlin said: “We’re being pretty honest in saying the outlook for acquiring new customers has become less certain [but] we’ve got a balance sheet in good health.”
Naked Wines shares climbed 0.7% to 98p.
