Total sales declined by 1.3% in the year driven mainly by temporary Covid-related closures in the first part of the year and site disposals since its 2019 financial year (FY).
Although lfl sales grew 1.1% for its latest FY, this figure was down 0.9% when excluding the VAT benefit gained in this period.
Encouraging bank holiday sales
In its fourth quarter results, lfl sales improved (up 1.5%) despite the ongoing impact of extreme heat as well as further rail strikes, both of which disrupted trade. Sales over the August bank holiday were “encouraging”, with lfl growth over the three-day weekend of more than 6%, before returning to levels consistent with the quarter as a whole.
On energy price rises, M&B said the recent announcements of domestic and business energy price caps are welcomed both due to the impact on guest disposable income and the reduction of cost downside to the business from potential further adverse market price increases.
However, the business added it expects total energy and utility costs to have increased to c£150m for FY 2022 (FY 2019: £80m) and, even with the cap in place, anticipates a further increase on that for FY 2023.
Renovations to 166 sites
The group currently has cash balances of c£160m, in addition to undrawn committed unsecured facilities of £150m. It has completed 166 conversions and remodels in the FY to date.
M&B chief executive Phil Urban said: “The trading environment for the hospitality sector remains very challenging with cost inflation putting increasing pressure on margins and we are also mindful of the pressures on the UK consumer over the coming months.
“We remain focused on the delivery of our Ignite programme of initiatives, driving sales and delivering cost efficiencies. This will, combined with our diverse portfolio of well-known brands and strong estate locations, put us in a stronger competitive position to face the challenges ahead.”