Mitchells & Butlers (MAB) H1 2025 earnings summary

Executive summary

• Like-for-like sales grew 4.3% in the first half, outperforming the market by about 3 percentage points, with strong trading momentum and efficiency initiatives supporting growth.

• Operating profit increased 10.4% year-over-year to £181m, with operating margin up to 12.4% from 11.7% in the prior year.

• Net debt reduced to £860m (excluding leases), representing 1.9x EBITDA, and record guest review scores reached 4.6/5.

• Capital investment programme continues to deliver strong returns and estate enhancement, with remodel ROI above 35%.

• Full-year operating profit is expected at the top end of consensus, despite anticipated cost headwinds.

Financial highlights

• Revenue rose 4.2% year-over-year to £1,454m for the 28-week period.

• Operating profit up 10.4% to £181m; profit before tax up 24.1% to £134m; EPS increased 23.5% to 16.8p.

• Net debt reduced from over £2bn in 2015 to £860m in HY 2025 (excluding leases).

• Operating cash flow increased to £261m, with net cash flow before bond amortisation at £131m.

• EBITDA for the period was £252m, up from £233m in the prior year.

Outlook and guidance

• Like-for-like sales growth of 6.0% in the most recent 10 weeks, including key trading periods.

• Cost headwinds for the year remain at £100m (c.5% of cost base), mainly from labour and statutory increases; FY26 expected to see higher inflation with cost increases approaching £130m.

• Cost headwinds expected to revert to trend (£90m/year) from 2027.

• Profits expected at the top end of consensus for the current year, with sales momentum anticipated to continue into next year.