Mitchells & Butlers, the UK pub giant that owns the All Bar One, Harvester, O’Neill’s and Toby Carvery chains, has said that it may need to raise fresh funds after a collapse in sales over the Christmas and New Year period. Its pubs and bars are shut during England’s third national lockdown, until at least mid-February. Shares in the firm fell 6.7%.
Sales plunged 67.1% in the 14 weeks to 2 January because of Covid-19 restrictions. This week, takeaway sales of alcohol from pubs in England were banned, dealing a further blow to the hard-hit pubs sector which is struggling for survival.
The company, which runs 1,700 pubs across the UK, revealed in late November that it had laid off 1,300 people in the previous two months. During each month its pubs are closed, the business burns through up to £40m to pay rent and other bills, and it has to meet £50m debt costs each quarter. M&B said:
The directors believe it is prudent to explore an equity capital raise, to give the group increased financial and operational flexibility. No decision has yet been made with regards to the timing, size, or terms of any such equity capital raise.