Pub meals outsell drinks for first time

by walesonline.co.uk - 23/05/2011

"HARVESTER and Toby Carvery owner Mitchells & Butlers has warned soaring food and energy prices would continue to squeeze the business into next year."

Mitchells, which also owns All Bar One, said challenges lie ahead from rising inflation and uncertainty around household spending in the UK.

But its strategy to focus on food sales was well on track after meals outsold drinks for the first time.

The company reported 7.5% total sales growth in food in the 28 weeks to April 9, while total drinks sales grew 1.7% in the same period.

Mitchells, which now has nearly 1,600 restaurants and pubs, reported a 14% drop in pre-tax profits to £63m, but this reflected the £373m sale of drinks- led brand Stonegate.

Mitchells saw shares drop 4% after it disappointed the market with lower-than-expected operating margins, which have been squeezed by the rising cost of raw materials and energy bills.

The group’s restructuring programme has also involved investing £53m in 29 new openings and 31 conversions. Looking ahead, it hopes to open 50 further sites and complete 70 brand conversions.

The group said its search for a new chief executive was progressing well, following the departure of Adam Fowle.

Interim chief executive Jeremy Blood said: “We have successfully positioned Mitchells & Butlers more firmly within the eating-out market with nearly three quarters of our revenue now generated around eating-out.”

More Details: http://www.walesonline.co.uk/business-in-wales/business-news/2011/05/21/pub-meals-outsell-drinks-for-first-time-91466-28734664/