UK's Mitchells & Butlers says recent trading hit by soft consumer spending (updated)
21/05/2026 07:59
Second-quarter sales growth slows to 1.8%, further easing to 1.1% recently Expects cost headwinds to be slightly lower this year JPMorgan analysts highlight pressure on higher-end bars within co's portfolio Adds shares, analyst comments, background, and context throughout May 21 (Reuters) - British pub group Mitchells & Butlers MAB.L said like-for-like sales growth slowed in the second quarter and beyond as cautious consumers pulled back on spending, sending its shares down as much as 9% on Thursday. The company, which operates more than 1,700 pubs and restaurants, reported group like-for-like sales growth of 1.8% in the second quarter, marking a slowdown from the first quarter's 4.5% expansion. In the most recent three-week period, growth slowed further to just 1.1%, it said. JPMorgan said the company had also highlighted some macro pressures that it understood were skewed more towards higher-end bars than pubs and pub restaurants, "something that may raise concerns amongst the investor base pertaining to H2". BRITISH CONSUMERS CUT SPENDING British consumers, shaken by the inflationary impact of the Middle East conflict, cut spending last month for the first time since November 2024, a survey by Barclays showed last week. UK pub operators are relying on cost controls to protect margins as rising wages and energy costs also pressure the sector. Mitchells & Butlers has been refurbishing venues and refreshing menus to drive footfall to offset rising costs, and said cost headwinds for the current financial year would be slightly lower than previously expected, adding that it currently has 15% of energy costs secured for fiscal 2027. The Birmingham-based company, which operates pub and restaurant brands including Harvester, Toby Carvery, All Bar One, Miller & Carter, O'Neill's and Browns, reported a half-year pretax profit of £143 million ($192 million), up from £134 million a year ago. Earlier this month, pub group Marston's MARS.L reported lower sales, hurt by soft demand and refurbishment closures, while JD Wetherspoon JDW.L issued its third profit warning in five months as rising costs weighed on the pub chain. Young & Co's Brewery YNGa.L said on Thursday its like-for-like sales rose 3.4% over the last five weeks despite a strong year-earlier period, when sunny weather boosted footfall. Mitchells also flagged a tough year-on-year comparison. ($1 = 0.7448 pounds) (Reporting by Nithyashree R B in Bengaluru; Editing by Subhranshu Sahu and Jan Harvey) ((NithyashreeRB@thomsonreuters.com))