Insider Media Limited

Birmingham-based Mitchells & Butlers has continued the trend of a slow recovery in West Midlands pubcos with a 4.2 per cent increase in sales, it revealed this morning. Overall sales rose 4.2 per cent for the 28 weeks to 9 April 2011, with food sales having increased by 7.5 per cent. For the first time, food sales outstripped drink sales at the company.

Revenue at the company excluding disposals carried out in the last year was up 4.2 per cent from £875m to £912m. Total revenue including these assets fell 8.8 per cent to £946m.

Mitchells & Butlers said it had invested £53m of expansionary capital over the six-month period, with 29 new openings and 31 conversions. The company said it planned to open a further 50 sites in 2011.

Pre-tax profit slipped 13.7 per cent to £43m, while adjusted operating profit dropped 9.6 per cent to £141m compared to the same period in 2010.

Earlier this week, Greg Watts, audit partner at KPMG in the Midlands, told Insider he expected to see a slowdown in the decline of the pub industry in the region.

Jeremy Blood, interim chief executive, said: "Our growth strategy is on track and has delivered a strong trading performance with total sales up 4.2 per cent. Harvester's performance has been particularly good, supported by its new advertising campaign together with its new breakfast and take-away menus. We have successfully positioned Mitchells & Butlers more firmly within the eating-out market with nearly three quarters of our revenue now generated around eating-out.

"We have a healthy balance sheet and are investing for further growth with 50 new sites being opened this year from our brand roll-out. I have been impressed with the depth of skills within the company that gives Mitchells & Butlers an excellent growth platform and enables the board to have confidence in the prospects for the business."