Mitchells & Butlers, the pub giant which owns Glasgow’s Horseshoe Bar, is continuing to perform ahead of the market, it told the stock market yesterday.

The company, which runs the O’Neill’s, Harvester, and All Bar One chains, declared that it has maintained its strong start to the year as it reported like-for-like sales growth of 5.7% for the 42 weeks to July 20, with revenue up 7.3%.

All brands have continued to grow, said the firm, which remains “very confident in the delivery of full-year consensus expectations”. This is in spite of sales growth moderating to 3.4% in the third quarter, which the company attributed to the timing of Easter this year, inflation easing, and the inclement weather.

Greg Johnson at Shore Capital noted that the current underlying run rate, excluding Easter, was 4.2%, which compares to the analyst’s second-half assumptions of around 3%.

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“We are pleased with the continued strong trading performance, which has remained ahead of the market through the year,” said chief executive Phil Urban.

“As inflationary pressures have eased the level of price increase we have taken has reduced, leading to headline sales growth in line with more normalised levels as expected during the second half. The combination of easing inflationary costs and continued sales growth will ultimately benefit our profit levels for the year.

“Our focus remains on the effective execution of our Ignite programme of initiatives and our successful capital investment programme, driving cost efficiencies and increased sales. With the unique strengths of our business, including a diverse portfolio of established brands, value proposition and enviable estate locations, we are well positioned to continue to grow profitability and market share into next year.”

Mitchells & Butlers, which has an estate of around 1,700 pubs and restaurants, said it continues to anticipate net cost headwinds in the region of £55m in the current financial year. It expects increases in labour costs due to the statutory national living wage rise to be mitigated in part by deflation in energy costs, slowing food inflation and strong cost control at site level.

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“Coupled with a robust sales performance we believe this will allow us to continue to rebuild margins and we remain very confident in the delivery of full-year consensus expectations,” the firm said.

Mr Johnson noted that, having upgraded forecasts for M&Bs twice this year, it has retained its estimate of the firm achieving a full-year profit before tax of £187 million. “Were current trading trends (4.2%) top continue, full-year LFL (like-for-like sales) could end at circa 5.4%, modestly above our estimate of 5% and potentially equivalent to c£5m additional profitability,” he said in a note for investors.

“We see the trading trends at MABs encouraging, with scope not tickle full-year numbers up further.”

M&Bs said it had completed 139 conversions and remodels of outlets in the year to date, and opened six new outlets. This is in addition to the continued roll-out of a number of initiatives to reduce energy usage, such as solar panels and sensors, the company said.