Mitchells & Butlers provides a trading update in light of the unprecedented COVID-19 situation which is currently having a material impact across the sector.
For the first 24 weeks of the year, up to 14 March, like-for-like sales were 0.9%. Within this recent trading has been severely impacted by COVID-19 and the containment measures taken by the Government, including the recommendation to avoid pubs and restaurants which is now expected to lead to a further significant downturn in sales.
Given the rapidly evolving nature of the situation it is impossible to quantify the impact COVID-19 could have on our financial performance. However, we expect a significant reduction in our expected outturn for 2020 and, given this uncertainty, can no longer provide detailed guidance on the expected forward financial performance for the year.
We are working proactively to protect our trading and cash flow through a number of actions including suspension of the capital programme and reduction of costs across the business.
The group currently has a strong balance sheet with material cash resources which should be sufficient to fund obligations through the half year on 11 April 2020, and well into the second half. The next securitisation restricted payment and covenant test is at the half year. Sufficient headroom has been established such that we believe the group could suffer a significant loss in the remaining four weeks to the test date and still clear covenant levels. We are working hard to deliver a performance within these parameters and are encouraged by the measures announced last night by the Chancellor, notably business rates relief and access to a credit guarantee facility, which should further underpin our future performance and liquidity.
For further information, please contact:
| Tim Jones - Chief Financial Officer | +44 (0)121 498 6112 |
| Amy de Marsac - Investor Relations | +44 (0)121 498 6514 |
| James Murgatroyd (Finsbury) | +44 (0)20 7251 3801 |
Note for editors:
Mitchells & Butlers is a leading operator of managed restaurants and pubs. Its portfolio of brands and formats includes Harvester, Toby Carvery, All Bar One, Miller & Carter, Premium Country Pubs, Sizzling Pubs, Stonehouse, Vintage Inns, Browns, Castle, Nicholson's, O'Neill's and Ember Inns. In addition, it operates Innkeeper's Lodge hotels in the UK and Alex restaurants and bars in Germany. Further details are available at www.mbplc.com and supporting photography can be downloaded at www.mbplc.com/imagelibrary.