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Half Year Results 2014

(For the 28 weeks ended 12 April 2014)

Return to food volume growth underpins successful first half

Statutory results

  • Profit before tax: £68m (H1 2013: £68m)
  • Basic earnings per share: 12.9p (H1 2013: 13.4p)

Financial performance

  • Total revenue of £1,016m, up 2.5%
  • Like-for-like sales growth of 1.1%a
  • Adjusted operating profit of £147mb, up 2.1%
  • Adjusted earnings per share of 14.6pb, up 1.4%
  • Net cash flow of £43mc

Balance sheet and cash flow

  • Agreement reached with Trustees on 2013 pensions valuation. Deficit increased to £572m as at March 2013; annual contribution increased to £45m (previously £40m per annum)
  • Capital expenditure increased to £86m (H1 2013: £59m), including 11 new site openings and 4 conversions
  • Net debt of £1.7bn representing 4.1 times annualised EBITDAd

Operational performance

  • Turnaround in volume performance: like-for-like food volume growth (H1 2014:+0.2%, H1 2013: -4.7%), drink volume stabilising (H1 2014:-0.3%, H1 2013: -6.0%)
  • Operating margin maintained at 14.5%e
  • EBITDA returns of 16% achieved on expansionary capex invested since FY 2011f
  • Staff turnover at historical low of 78% and net promoter score growing strongly to 63%

Alistair Darby, Chief Executive, commented:

"We are pleased with our trading performance in this first half, particularly the turnaround in volumes, alongside which we have made good progress against our key priorities, and continued to position Mitchells & Butlers for sustainable long-term future growth.

Successful resolution of the recent triennial pensions valuation, which we are announcing today, provides greater visibility and certainty over future funding and cash flow, at an affordable level.

Our business transformation is gaining momentum. Through our clearly laid-out strategy, we are well-placed to take advantage of the economic recovery across the UK."


a – Like-for-like sales growth includes the sales performance against the comparable period in the prior year of all UK managed pubs that were trading in the two periods being compared. For the 28 weeks to 12 April 2014, 97% of the UK managed estate is included in this measure.

b – Adjusted items are quoted before exceptional items and other adjustments as noted in the Group Income Statement.

c – Net cash flow excludes £28m mandatory bond amortisation and £148m which the Group was obliged to draw down from a liquidity facility under the terms of the securitisation. Net cash flow is detailed within the Financial Review.

d – Adjusted EBITDA for the 52 weeks to 12 April 2014.

e – Operating margin is taken before exceptional items and other adjustments and is compared to H1 2013.

f – Growth in annualised site EBITDA, expressed as a percentage of expansionary capital.

There will be a presentation for analysts and investors at 9.00am at Nomura International plc, 1 Angel Lane, London, EC4R 3AB. A live webcast of the presentation will be available at www.mbplc.com. The conference will also be accessible by phone: 020 3059 8125 and quote "Mitchells & Butlers". The replay will be available until 4 June 2014 on 0121 260 4861 replay access pin 4751710#.

All disclosed documents relating to these results are available on the Group's website at www.mbplc.com.

For further information, please contact:

Tim Jones – Finance Director+44 (0)121 498 6112
James Murgatroyd (RLM Finsbury)+44 (0)207 251 3801

Notes for editors:

  • Mitchells & Butlers is the UK's largest operator of managed restaurants and pubs. Its portfolio of brands and formats includes Harvester, Toby Carvery, Country Pubs, Crown Carveries, Sizzling Pubs & Oak Tree, All Bar One, Browns, Miller & Carter, Castle, Alex, Nicholson's, O'Neill's and Ember Inns. Further details are available at www.mbplc.com and supporting photography can be downloaded at www.mbplc.com/imagelibrary
  • Mitchells & Butlers serves around 130 million meals and 410 million drinks each year and is one of the largest operators within the UK's £75 billion eating and drinking out market.

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