Shares in Mitchells & Butlers have jumped more than 9% after the company reported higher comparable sales and profit for the first-half of the year, despite increased costs mainly from higher wages.
The company operates more than 1,700 pubs, bars and restaurants and owns brands such as All Bar One, Harvester and Toby Carvery.
Pretax profit rose to 75 million pounds in the six months to April 13, from 69 million a year earlier.
Comparable sales rose 4.1%, while total revenue rose 5% to 1.19 billion pounds.
“The market backdrop remains uncertain due to the political and economic landscape in the UK. However we are pleased with the progress of our trading performance and with the momentum the business carries into the second half of the year,” the company said.
Like other British pub operators, Mitchells & Butlers has had to cope with higher costs, most notably from wage inflation and property costs, following Britain’s vote to leave the European Union, which has also caused UK consumers to rein in spending.
Mitchells & Butlers, founded in 1898, relied on beer for the bulk of its sales in the 1980s, but now 50% of total sales come from food.
Liberum analysts said the like-for-like sales growth of 4.7% in the first quarter and 3.5% in the second quarter was ahead of market expectations.
The company’s shares were 6.4% higher at 258 pence, making it one of the biggest gainers on London’s midcap index($1 = 0.7933 pounds)
