Results round-up

Half year reported pre-tax profits at Babcockjumped 12% to £163.5m on revenues up 7% to £2.1bn and said it expected full year numbers to be in line with expectations.

The order book for the group remains at £20bn, having been replenished by £2bn of contracted work during the first half of 2016/17. Babcock said the order book provided strong visibility of future revenues in the short and medium term with 93% of revenue in place for full year 2016/17 and 63% for 2017/18.

"Our UK markets remain positive, with the group well positioned for the significant future outsourcing opportunities expected from both our defence and civil customers, and we see growing international demand for our specialist and complex engineering support services,” the company said.

“Despite slightly slower organic growth, the board expects the full-year results to be in line with its expectations. We therefore remain confident of making good progress both this year and beyond."

Babcock said UK markets continued to grow “despite the broader uncertainties” and that so far it had been unaffected by the decision to leave the European Union.

“The UK government's five-year Strategic Defence and Security Review confirmed its commitment to invest in multi-year programmes, requiring the life extension of existing platforms, and a whole force approach,” it added.

The dividend rises 7% to 6.5p a share.

Pub group Mitchells & Butlers posted a drop in pre-tax profit for the 52 weeks ended 24 September as like-for-like sales fell and total revenue declined.

Pre-tax profit fell to £94m from £126m the year before on total revenue of £2.09bn, down from £2.1bn. Meanwhile, like-for-like sales were down 0.8%, although trading in the most recent eight weeks has picked up, with LFL sales up 0.5%.

The company declared a final dividend of 5p per share, unchanged from the previous year.

Adjusted earnings per share fell by 2.2% to 34.9p, reflecting the lower total sales and a weaker margin in the second half after the introduction of the National Living Wage.

Mitchells & Butlers highlighted increasing competition, noting that in the year to June 2015, there were over 1,700 net restaurant openings, which is broadly the equivalent of its own business in terms of outlet numbers.

“This provided us with many new local competitors and impacted our mid-market brands in particular, as a number of these openings were close to our own high-quality trading locations.”

However, since then the rate of openings has slowed significantly, mostly due to cost headwinds such as the introduction of the National Living Wage, M&B said.

With net restaurant openings now broadly flat year-on-year, the group said it has “an opportunity to win back market share”.

Chief executive Phil Urban said: “During the year we have made good progress in our three priority areas: building a more balanced business; instilling a more commercial culture; and driving an innovation agenda. This focus is starting to have a positive effect on our sales, with improved performance against a subdued market in recent months through continuation of the momentum we saw start in the second half of last year.