Pub group Mitchells & Butlers (MAB) has warned the wet British summer will dent its full-year profits following a year of sluggish performance, culminating in the sacking of its chief executive Alistair Darby.
The Toby Carvery and Harvester owner grew like-for-like sales by just 1% in the 50 weeks to 12 September, registering a 0.7% decline in like-for-like sales in the last seven weeks.
A warning that full-year growth will be at the bottom end of current market expectations sends the shares down 2.8% to 341.6p.
Darby, who was named CEO of the £1.4 billion cap only three years ago, has been blamed for the group’s poor performance and will leave his post on 26 September.
Darby is being replaced by Phil Urban, who was appointed Mitchells & Butlers’ chief operating officer in January after stints at Rank (RNK) and Whitbread (WTB).
Whether Urban can solve the group’s problems remains to be seen. The company has been through about five chairmen and five CEOs in the past six to seven years, all of which have ultimately failed to turn around the business’ prospects.
Langton Capital analyst Mark Brumby says some of the group’s prime assets have a 1980s or 1990s feel about them and, unlike its peers, the company hasn’t diversified into other offerings.
‘With Whitbread pushing Costa, Greene King (GNK) going the acquisition route, Marston’s (MARS) building new sites like fury and JD Wetherspoon (JDW) moving into breakfasts, SA Brain into coffee shops, Fuller, Smith & Turner (FSTA) into The Stable, Young & Co’s Brewery (YNGA:AIM) into Geronimo and the rest, may there not have been something missing at Mitchells & Butlers over recent years?’ he says.
