UK pub group Mitchells & Butlers – of which Irish financiers JP McManus and John Magnier are substantial shareholders – has posted a first-half loss and warned of ongoing uncertainty ahead of a return to trading.
As one of the largest pub groups in the UK, the news is likely to act as a further warning sign to struggling Irish pubs readying their own reopenings.
Publican groups here have called for a significant VAT rate cut in order to aid their survival after the impact of the Covid-19 lockdown.
The Vintners Federation of Ireland, the Licensed Vintners Association and Drinks Ireland have called for a 9% VAT rate cut for the hospitality sector.
Padraig Cribben, the CEO of the Vintners Federation of Ireland, warned that many pubs due to open on July 20 simply won’t be able to as necessary restrictions will mean it is not financially viable.
Mr Cribben said the impact of Covid on the country’s drinks and hospitality industry as been devastating.
Mitchells &Butlers – which owns the Irish-themed O’Neill’s pub chain, the All Bar One business and the Harvester family restaurant chain – said it is uncertain about consumer demand and how its pubs and restaurants will function with strict social distancing measures, as it gears up to reopen most of its sites in England this weekend.
The company swung to a pre-tax loss of £121m (€134m) for the six months to April 11, from a profit of £75m last year, reflecting nearly four weeks of closures due to the Covid-19 lockdown in Britain.
The owner of around 1,700 restaurants and pubs in the UK said it is currently not meaningful to give an outlook.
Shares in the company, which have fallen nearly 60% so far in the year, were flat.
It recorded an £11m charge primarily from disposing or donating short-dated food and drink stock items due to the closures.
Mitchells & Butlers said its sites will have signs to maintain social distancing, sanitising stations, disposable menus, table spacing, capacity management where possible through online booking and a cashless-first approach.