McManus and Magnier-backed UK pub group eyes strong Covid recovery

JP McManus: Significant shareholder in British pub group Mitchells and Butlers.

British pub group Mitchells and Butlers in which financiers JP McManus and John Magnier are significant shareholders has said it is in a strong position as Covid restrictions ease in the UK.

The group, which owns chains such as O'Neill's and All Bar One, said that its sales in the year-to-date, including 18 weeks of enforced closure, are at 35% of pre-Covid levels, but trading has been helped by the UK’s temporary reduction in its hospitality Vat rate.

UK pub operators have called for a permanent cut to the Vat rate, with it having been temporarily slashed from 20% to 5%.

The group's chief executive Phil Urban said the continuing uncertainty over the pandemic still makes revenue and earnings' forecasts difficult and is likely to do so “at least until into the autumn”.

However, he said with a diversified portfolio of brands and a strengthened balance sheet, and largely freehold estate, the group is in a strong position coming out of the pandemic.

Mr McManus and Mr Magnier jointly own more than 23% of the group through their Elpida investment vehicle. British businessman and Tottenham Hotspur co-owner Joe Lewis is another sizeable investor in the pub group.

Earlier this year, Mr McManus and Mr Magnier backed plans for a €400m share sale as part of the group's Covid survival plan.