All Bar One owner Mitchells & Butlers has drop in sales amid ‘major challenges’ from inflation
All Bar One owner Mitchells & Butlers continue to face a “major challenge” due to the impact of the pandemic and ongoing inflation rises.
The retailer experienced a drop in sales by 1.6 per cent in the year to date, claiming a mixture of the Jubilee weekend, industrial action and hot weather saw people go out less.
Mitchells & Butlers, which also runs Toby Carvery, Harvester and O’Neill’s, said the main drivers of profit in the third quarter of trading was food, at 5.5 per cent of growth, while drink sales went down 4.9 per cent.
It added that the cost of living crisis and inflationary pressures continue to “present a major challenge to our business and to the hospitality sector as a whole”.
While the short-term outlook is “unchanged”, the rising costs for utilities, food costs and possibly wages, will impact the firm going into the next financial year.
Phil Urban, Chief Executive, commented: “The trading environment remains very challenging with inflationary costs squeezing consumer discretionary spending and putting pressure on the industry’s margins.
In the face of these challenges, we remain focused on driving sales and efficiency through our Ignite programme and pushing forward with our capital investment plan which we are pleased to see delivering strong sales uplifts.”
The group added that despite pressures, it had completed 116 conversions and remodels in the financial year to date, as it looks to improving its competitiveness.