Christmas cheer for pubcos before January blues
Pubcos Mitchells & Butlers and Enterprise Inns have been hit by January's cold snap and heavy snow despite trading well over the Christmas period.
Christmas sales at Birmingham-based M&B increased by 4 per cent on a like-for-like basis, with advance bookings at record levels.
In the 14 weeks to 5 January, like-for-like sales were 1 per cent ahead of last year but have since dropped off as the cold weather and snow landed. As a result, like-for-like sales in the 17 weeks to 26 January were 0.3 per cent lower than the previous year.
The weather also hit Solihull-based Enterprise Inns as like-for-like net income for the 17 weeks to 26 January declined across its estate by £5m.
A number of factors made the first four months of the year "unusually challenging", the group said.
The extreme weather conditions of the past two weeks led to reduced footfall and a consequential loss of beer volume which is estimate to have reduced net income by £1.5m.
However, Enterprise added that trading in the weeks around Christmas and the New Year was strong and produced a "welcome respite".
The company has also signed a new two-year distribution agreement with Carlsberg. Enterprise was hit in October when its wines and spirits distributor Waverley collapsed leading to a direct loss of about £1m of trading income.
"We expect trading conditions to remain difficult in 2013 as consumers face economic uncertainty and publicans have to manage rising cost pressures," the group said.
"Our focus on enhancing the quality of our estate, attracting and retaining the right publicans and providing exceptional support will leave us well placed in the year ahead. Despite a challenging start our target is to return the business to like-for-like net income growth in the second half of this year."
Mitchells & Butlers new chief executive Alistair Darby said: "I am pleased with our performance over Christmas and the New Year. Our planning for Christmas was excellent and we provided our guests with great experiences, as shown by the fact that a third of our pubs, bars and restaurants broke their weekly sales records.
"Since the New Year, trading has slowed as consumers tighten their belts. Although we do not expect economic conditions to become any less challenging over the next 12 months, we remain confident in our ability to perform well in the year ahead as a result of our continued focus on service and amenity coupled with the high quality of our assets, brands and formats."