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16/05/2018

Half Year Results 2018

(For the 28 weeks ended 14 April 2018)

  • Sustained like-for-like sales outperformance
  • Fresh wave of initiatives to further transform the business

Financial performance

  • Like-for-like salesa growth of 1.6%; growth adjusted for impact of snow of 2.5%
  • Like-for-like salesa growth of 5.8% over Easter weekend which moves into the first half
  • Adjusted operating profita of £141m (H1 2017 £149m)
  • Adjusted earnings per sharea of 13.9p (H1 2017 15.2p)

Strategic progress

  • Completed 224 capital projects as part of 6-7 year cycle; 100th Miller and Carter opened
  • Improved customer satisfaction; net promoter score up 5 points
  • Digital penetration increased; 120k online bookings per week (H1 2017 80k)

Reported results

  • Total revenue of £1,130m (H1 2017 £1,123m)
  • Operating profit of £137m (H1 2017 £145m)
  • Profit before tax of £69m (H1 2017 £75m)
  • Basic earnings per share of 13.0p (H1 2017 13.7p)

Balance sheet and cash flow

  • Capital expenditure of £104m (H1 2017 £93m), including 4 new site openings and 220 conversions and remodels (H1 2017 172)
  • Adjusted free cash flow of £(3)ma (H1 2017 £(18)m)
  • Net debt of £1.72bn (H1 2017 £1.83bn) representing 4.1 times adjusted EBITDAa (H1 2017 4.3times)

Phil Urban, Chief Executive, commented:

"During the first half we continued to deliver like-for-like sales growth against a period of growth last year. This strong performance comes from the progress we continue to make in our three priority areas: building a more balanced business; instilling a more commercial culture; and driving an innovation agenda.

Success in this highly competitive market is dependent on a continuous stream of improvements, and that is what we are focused on delivering. We have therefore embarked upon a new wave of initiatives which are in their early stages of development, and we believe have the potential to further transform the business.

As previously announced, margins are being adversely impacted by increased costs, most notably from wage inflation, property costs, energy and food and drink costs. In light of this, our operational teams have performed well to deliver flat underlying profitabilityb in the period."

Definitions

a – The Directors use a number of alternative performance measures (APMs) that are considered critical to aid the understanding of the Group's performance. Key measures are explained later in this announcement.

b – The period was impacted by one off adjusted operating profit items which are explained in the operating margin section of the Financial Review.

There will be a presentation today for analysts and investors at 9.30am at the London Stock Exchange, 10 Paternoster Square, London, EC4M 7LS. A live webcast of the presentation will be available at www.mbplc.com. The presentation will also be accessible by phone: 020 3059 5868 and quote "Mitchells & Butlers". The replay will be available until 23 May 2018 on 0121 260 4862 replay access pin 386401#.

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
Amy De Marsac – Investor Relations+44(0) 7712 538660
James Murgatroyd (Finsbury)+44(0)20 7251 3801

Notes to editors:

  • Mitchells & Butlers is a leading operator of managed restaurants and pubs. Its strong portfolio of brands and formats includes Harvester, Toby Carvery, All Bar One, Miller & Carter, Premium Country Pubs, Sizzling Pubs, Crown Carveries, 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.

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