M&B shares rise 3% as pubs giant backed by JP McManus starts to weather costs inflation

M&B operates under the outlets All Bar One, Browns, Ember Inns, Harvester, Miller & Carter, Nicholson's, Sizzling Pubs, Toby Carvery, and O'Neill's in Britain. 

Shares in British pubs and restaurants giant Mitchells & Butlers — which is part-owned by Irish investors JP McManus and John Magnier — ended 3% higher in the session after the group said it was starting to weather the huge challenge of costs inflation facing hospitality businesses.  

With 1,600 outlets, M&B is one of the largest pub and restaurant groups in Britain, and operates under the outlets All Bar One, Browns, Ember Inns, Harvester, Miller & Carter, Nicholson's, Sizzling Pubs, Toby Carvery, and O'Neill's. 

Managing inflationary costs was still a challenge but the outlook was improving, and trade in recent weeks had picked up significantly, chief executive Phil Urban said in a commentary on the results. 

"The trading environment for the hospitality sector remains challenging with inflationary costs putting pressure both on the industry’s margins and disposable income of our guests," Mr Urban said. "However, we are encouraged by the resilience of trade to date, including the most recent six weeks", he said.     

Reflecting the rise in costs, pre-tax profits for the six months through to early April, fell to £40m (€46m) from £57m a year earlier, as revenues rose to £1.28bn from almost £1.16bn in the same period. 

The London-listed shares of M&B have now climbed 46% since the start of the year, but are still slightly below levels of a year ago. The Ftse-250 company is valued at £1.16bn. Mr McManus and Mr Magnier own over 20% of M&B. 

The M&B results complete a mixed bag for the huge British pub groups. 

Shares in Wetherspoon rose last week after it reported that trade at its British and Irish pubs, although recovering, was nonetheless short of the boom conditions that some had anticipated following the lifting of the pandemic restrictions. 

Rival Marston's also posted earnings that showed how the British hospitality businesses were coping with inflationary costs.