Mitchells & Butlers (LON:MAB) Releases Quarterly Earnings Results

Mitchells & Butlers (LON:MAB) announced its quarterly earnings results on Thursday. The company reported GBX 17.40 earnings per share for the quarter, Digital Look Earnings reports. Mitchells & Butlers had a net margin of 6.70% and a return on equity of 6.41%. The firm had revenue of GBX 149 billion during the quarter.

Here are the key takeaways from Mitchells & Butlers’ conference call:

• First-half operating profit held at GBP 181 million despite significant cost pressures, showing the business was able to offset inflationary headwinds with sales growth and Ignite-driven efficiencies.
• Like-for-like sales rose 3.3% in the first half, with Q1 up 4.5% and Q2 still positive at 1.8%, though weather and tougher comparisons made the trend harder to read.
• Cost headwinds were severe but may be easing: management said this year’s inflation burden is slightly below prior guidance and next year’s is expected to fall to about GBP 95 million, helped by lower National Insurance pressure and energy being partially locked in.
• Cash generation and the balance sheet improved further, with net debt reduced to just under GBP 750 million, gearing at about 1.6x EBITDA excluding leases, and net assets rising to GBP 4.91 per share.
• Management is continuing to invest for growth, including a higher CapEx plan of about GBP 230 million, new site acquisitions, the rollout of Guest 360 CRM, and ongoing AI and labor-efficiency initiatives under Ignite.

Mitchells & Butlers Price Performance

Shares of MAB opened at GBX 231 on Friday. The company has a 50 day moving average price of GBX 259.41 and a 200-day moving average price of GBX 264.85. Mitchells & Butlers has a fifty-two week low of GBX 228 and a fifty-two week high of GBX 308. The stock has a market capitalization of £1.37 billion, a PE ratio of 7.83, a PEG ratio of 2.76 and a beta of 1.30. The company has a debt-to-equity ratio of 19.70, a quick ratio of 0.46 and a current ratio of 0.48.

Analysts Set New Price Targets

MAB has been the subject of several research reports. Jefferies Financial Group reaffirmed a “buy” rating and issued a GBX 355 price target on shares of Mitchells & Butlers in a research report on Thursday. Berenberg Bank reaffirmed a “buy” rating and issued a GBX 1,150 price target on shares of Mitchells & Butlers in a research report on Monday, March 30th. Five analysts have rated the stock with a Buy rating and two have issued a Hold rating to the stock. According to MarketBeat.com, Mitchells & Butlers has an average rating of “Moderate Buy” and a consensus target price of GBX 485.

Mitchells & Butlers Company Profile

Mitchells & Butlers is a leading operator of managed restaurants and pubs in the UK. It listed on the London Stock Exchange in April 2003 and is a member of the FTSE 250. Its restaurants and pubs have some of the highest average sales and profits per site in the industry and it operates the best portfolio of brands in the UK.