Mitchells & Butlers PLC on Thursday reported growth in annual revenue and said it has kicked off the new year strongly, but it swung to a loss.

The Birmingham, England-based company operates restaurants and pubs under brands that include Harvester, Toby Carvery, All Bar One, Nicholson’s and O’Neill’s.

In the 53 weeks ended September 30, Mitchells & Butlers swung to a pretax loss of £13 million from a profit of £8 million a year ago.

The company said profitability was impacted by movements to the property portfolio valuation as well as significant cost headwinds during the financial year. Operating costs were 17% higher at £2.15 billion from £1.84 billion.

More positively, Mitchells & Butlers reported total revenue of £2.50 billion up 13% from £2.21 billion a year earlier.

Chief Executive Phil Urban said: ‘We are delighted by the continued strength of our trading performance, and resilience in the face of unprecedented cost headwinds. We have achieved good growth in underlying profit, excluding government support, with like-for-like sales growth across all of our brands, and record outperformance against the market.’

In the eight weeks since the end of its financial year, like-for-like sales have risen 7.8% on-year.

Mitchells & Butlers added: ‘Cost headwinds presented a significant challenge in FY 2023 but we are seeing clear evidence that these are starting to abate. We now know that the national living wage will increase by 9.8%, and be extended to everyone over 21, from April next year, but a reduction in energy prices and slowing food inflation, in particular, mean that anticipated overall cost headwinds for the year ahead are expected to reduce to £65 million. This should allow us to start to rebuild margins back towards pre-pandemic levels.’

Shares in Mitchells & Butlers were down 4.0% to 232.80 pence each in London on Thursday morning.

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