All Bar One owner Mitchells & Butlers sees sales rise

man drinking beer
Image caption Mitchells and Butlers says it is holding up well in the face of a weak retail environment

The pubs group Mitchells & Butlers (M&B) has announced that sales over the Christmas and New Year period were 4.4% higher than a year ago.

The company, whose chains include All Bar One, Harvester, Toby Carvery and O'Neills, also said it was confident there would be further growth ahead.

The sales rise, measured in its outlets open for more than a year, beat the expectations of analysts, whose average forecast was 2.6%.

M&B has 1,600 UK restaurants and pubs.

The company has fought off two takeover bids from its biggest shareholder, the billionaire currency trader, Joe Lewis, who owns 25% of the business.

Mr Lewis also has a stake in the Premier League football club, Tottenham Hotspur.

He offered 230 pence a share in October 2011. On Thursday morning the shares were trading at 258p.

M&B's management has been turbulent in recent years, with six chairmen over the past two years and no permanent chief executive since last March.

Bob Ivell, a former managing director of Scottish & Newcastle's managed pubs division, is currently acting as executive chairman.

The situation has alarmed the Association of British Insurers (ABI), which represents about 20% of M&B's shareholders.

It has issued a "red top" alert on the company, its strongest possible warning about governance concerns, as it is the only FTSE-350 firm that currently has no independent non-executive directors.

The company said it was battling a weak retail environment, but was holding up very well: "The consumer environment remains challenging. Inflationary cost pressures in areas such as food, duty and energy continue, with the latter expected to impact particularly on the first half of the financial year.

Mr Ivell said: "These results reflect a successful Christmas sales performance. Although assisted by better weather, they show that customers are still keen to treat themselves even in a difficult economic environment. This gives me confidence in our ability to successfully develop and grow the business in the year ahead."

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