Annual Report 2017
In compliance with Listing Rule 9.6.1, Mitchells & Butlers plc has today submitted copies of the following documents to the National Storage Mechanism:
- Company Annual Report and Accounts 2017
- Notice of the 2018 Annual General Meeting
These documents will shortly be available for inspection at http://www.morningstar.co.uk/uk/NSM
The above documents can also be accessed on the Company's website at: www.mbplc.com
The Company's Annual General Meeting will be held at Mitchells & Butlers plc, Retail Support Centre, 27 Fleet Street, Birmingham, B3 1JP on Tuesday 23 January 2018 at 2.00pm.
A condensed set of Mitchells & Butlers plc financial statements, information on important events that have occurred during the year and their impact on the financial statements and responsibility statements were included in the Company's Full Year Results announcement on 23 November 2017. That information, together with the information on Risks and Uncertainties given below, constitutes the requirements of DGTR 6.3.5 which is to be communicated via an RIS in unedited full text. This announcement is not a substitute for reading the full Annual Report and financial statements. To view the Full Year Results announcement, visit the Company website: www.mbplc.com/investors/
Risks and uncertainties
This section highlights the top ten principal risks and uncertainties that affect the Company, together with the key mitigating activities in place to manage those risks. This does not represent a comprehensive list of all of the risks that the Company faces, but focuses on those that are currently considered to be most relevant.
The processes that are used to identify and manage risks are described in the internal control and risk management statement on pages 60 and 61 of the 2017 Annual Report.
| Risk category and description | Controls/mitigating activities |
|---|---|
Risk category and description Risk category and description | Controls/mitigating activities Controls/mitigating activities |
Risk category and description 1. Market risks | |
Risk category and description | Controls/mitigating activities |
Risk category and description | Controls/mitigating activities |
Risk category and description 2. Operational Risks | |
Risk category and description | Controls/mitigating activities |
Risk category and description | Controls/mitigating activities |
Risk category and description | Controls/mitigating activities |
Risk category and description | Controls/mitigating activities |
Risk category and description
|
The Company maintains headroom against these risks. The finance team conducts daily cash forecasting with periodic reviews at the Treasury Committee, the roles of which include ensuring that the Board Treasury Policy is adhered to, monitoring its operation and agreeing appropriate strategies for recommendation to the Board.
In addition, regular forecasting and testing of covenant compliance is performed and frequent communication is maintained with the Securitisation Trustee.
Pension fund deficit
The material value of the pension fund deficit remains a risk.
The Company has made significant additional contributions to reduce the funding deficit. In July 2017, the Company reached agreement on the triennial valuation of the Group pension schemes as at 31 March 2016, with a funding shortfall of £451m (March 2013 valuation £572m shortfall).
The Company will continue to pay cash contributions (of £46m p.a. indexed) to 2023, with an additional payment of £13m into escrow in 2024 should such further funding be required at that time.
Failure to operate safely and legally
A major health and safety failure could lead to illness, injury or loss of life or significant damage to the Company's or a brand's reputation.
Mitchells & Butlers maintains a robust programme of health and safety checks both within its restaurants and pubs and throughout the supply chain.
The dedicated Safety Assurance team uses a number of technical partners including food technologists, microbiologists and allergen specialists to ensure that our food procedures are safe.
Regular independent audits of trading sites are performed to ensure that procedures are followed and that appropriate standards are maintained.
Food suppliers are required to meet the British Retail Consortium Global Standard for Food Safety and are subject to regular safety and quality audits.
Comprehensive health and safety training programmes are in place.
Food supply chain safety
Malicious or accidental contamination in the supply chain could lead to food goods for resale being unfit for human consumption or being dangerous to consume. This could lead to restrictions in supply which in turn causes an increase in cost of goods and reduced sales due to consumer fears and physical harm to customers/employees.
M&B has a Safety Assurance team and uses a number of technical partners including food technologists, food safety experts, a microbiologist, allergy consultants, trading standards specialists, nutritionists etc.
M&B uses a robust system of detailed product specifications.
All food products are risk rated using standard industry definitions and assessment of the way the products are used in M&B kitchens. Suppliers are then risk rated according to their products.
Each food supplier is audited at least once per annum in respect of safety and additionally in response to a serious food safety complaint or incident.