Mitchells and Butlers (LSE: MAB) have started the new financial year strongly according to this mornings trading update. The British pub company said its key ten day Christmas period was less affected by the poor weather conditions than expected, as they achieved 4.9% sales increase over Christmas and New Year. Investors cheered the news, with shares surging over 8% this morning.
In the first 14 weeks of the financial year, like-for-like sale grew by 3.3%, with improved margins resulting from pricing actions, reduced food cost inflation, continued productivity gains and lower energy costs. During the first 14 weeks, net margins were 1.5% points better than the comparative period in the previous year.
The FTSE250 constituent believes its leading brands and proven operational ability provide confidence in its future outlook despite the caution over the consumer spending outlook, especially in the second half of the year.
Disclosure: The author holds no positions in the company