Mitchells & Butlers issues bullish trading statement ahead of expected bid battle

Pub operator Mitchells & Butlers (M&B) today released a bullish trading statement as speculation continues of a takeover bid for the company.

M&B said like-for-like sales at its 2,000 plus managed estate grew 4.3% in the 13 weeks to 22 April 2006.

It also said it planned to return a total of £500m to shareholders this calendar year, subject to not using some of the funds to make opportunistic pub package buys.

M&B, which makes more money through food sales than drink, said although early days, its Scottish pubs were faring extremely well since last month's smoking ban came into force.

However, the company warned operating profit remained under pressure due to rising energy, regulatory and staff costs, which will cost it £14m in the first half of the year.

M&B predicted operating profit would hit at least £143m in the first half of its financial year.

"We are very confident that our strategy will continue to deliver strong growth, further asset appreciation and value creation for the benefit of our shareholders," the company said.

Property tycoon Robert Tchenguiz, who already owns the Laurel and Globe pub companies, is expected to make a £4.6b formal bid for M&B soon.

M&B denies takeover bid from Tchenguiz >>

Tchenguiz admits approach for Mitchells >>

By Chris Druce

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