Annual Report 2025(16.89 MB) (MAB Annual Report 2025 Accessible)

Annual Report and Accounts 2025

Annual Report and Accounts 2025 Contents

Introduction

1. About us/Financial highlights/Environmental targets

2. At a glance 06 Welcome to

Mitchells & Butlers 08 Strategy in action

Strategic Report

24 Chair's statement

26 Chief Executive's business review

30 Our markets

32 Our business model

36 Value creation story

40 Our strategic priorities

42 Key performance indicators

44 Our sustainability targets

46 Task Force on Climate-related Financial Disclosures

52 Risks and uncertainties

60 Compliance statements - Corporate viability

disclosure

• Non-financial and sustainability information statement

• Section 172 Companies Act statement

62 Financial review

Governance

66 Governance at a glance

68 Chair's introduction to governance

70 Board of Directors

72 Directors' report

80 Statement of Directors' responsibilities in respect of the Annual Report

and Accounts

81 Corporate governance statement

94 Audit Committee report

98 Report on Directors' remuneration

Financial Statements

120 Independent auditor's report to the members of Mitchells & Butlers plc

128 Group income statement

129 Group statement of comprehensive income

130 Group balance sheet

131 Group statement of changes in equity

132 Group cash flow statement

133 Notes to the consolidated financial statements

183 Mitchells & Butlers plc Company financial statements

185 Notes to the Mitchells & Butlers plc Company financial statements

Other Information

189 Alternative performance measures

192 Shareholder information

‌Introduction Strategic Report Governance Financial Statements Other Information

About us

For over 125 years the Group has been at the forefront of UK drinking and eating out, running many of the UK's most beautiful and iconic pubs and restaurants. We employ over

50,000a people in pubs, bars and restaurants that are located across the UK and in Germany.

We are a leading operator of managed restaurants and pubs with 1,631 largely-freehold managed businesses representing some of the most popular brands and formats in the UK.

Our scale is impressive. In FY 2025 we served over 100 million meals, and over 320 million drinks.

Our strategy remains focused on our three priority areas of building a more balanced business, instilling a commercial culture, and driving an innovation agenda, whilst pursuing our purpose of being the host of life's memorable moments, bringing people and communities together through great experiences.

Financial highlights

Revenue

£2,711m

FY 2024: £2,610m

Financial review Go to page 62

Environmental targets

Net Zeroc

Greenhouse gas emissions

by FY 2040 (Scope 1, 2 & 3)

Sustainability targets Go to page 44

Statutory operating profit

£322m

FY 2024: £300m

Zero

Operational waste to landfill

by FY 2030

Adjusted operating profitb

£330m

FY 2024: £312m

50%

Reduction in food waste

by FY 2030

1. As at 27 September 2025.

2. The Directors use a number of alternative performance measures ('APMs') that are considered critical to aid understanding of the Group's performance. Key measures are explained on pages 189 to 191 of this report.

3. As defined on page 51.

Mitchells & Butlers plc Annual Report and Accounts 2025 01

‌Introduction

Mitchells & Butlers at a glance

Our brands

Browns restaurants are mainly located in city centres around the UK and offer casual, elegant, brasserie dining often in landmark architectural buildings.

28 sites

All Bar One bars are modern and cosmopolitan serving food and drink in bright, contemporary environments positioned in city-centre locations.

45 sites

Alex city centre bars and brasseries offer all day menus and drinking across Germany.

44 sites

Our balanced portfolio of recognised and diversified brands and formats is loved and trusted by our guests, with 65% home-grown and over 75% in existence for over 20 years.

Ember Inns are local pubs with an individual name offering food with a wide range of cask ales. They are in prominent residential locations.

149 sites

Ego restaurants are Mediterranean-style family restaurants based across the UK. The brand was fully acquired in 2023, having operated as a joint venture

since 2018.

33 sites

Castle pubs are a collection of eclectic urban pubs, with each pub having an individual character to suit its community. The pubs are located in city and suburban areas.

103 sites

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Strategic Report Governance Financial Statements Other Information

Harvesters are pub restaurants in suburban roadside locations, principally targeting families. They are well-known for spit-roast chicken, smoked ribs, burgers and the salad cart.

143 sites

Our High Street pubs are unique, individual pubs located in high footfall locations in cities and towns throughout the UK. The pubs offer music, sport and enjoyable hospitality at competitive prices points.

63 sites

Miller & Carter are steakhouse restaurants offering premium-grade beef. They are designed to be the steak lover's destination for everyday and special dining-out occasions.

133 sites

Our suburban pubs are typically located in densely populated residential areas and are local community pubs serving 'value for money' food on sizzling skillets.

228 sites

Nicholson's has been in operation since 1873 and is famous for its extensive cask ale and pie range. Nicholson's sites include examples of historic, authentic pubs in the United Kingdom.

82 sites

Stonehouse pubs offer freshly-carved, slow-cooked roasts, and stone-baked pizzas along with other pub classics.

82 sites

O'Neill's are Irish bars located in city and town centres as well as on suburban high streets. O'Neill's offers live sports and,

in larger sites, entertainment through music rooms.

42 sites

Located in the North West and Midlands, Pesto offers authentic and freshly prepared Italian small plates at sensible prices in an informal, relaxed setting.

12 sites

Toby Carvery is one of the leading brands in the UK carvery sector. It aims to offer

a good value and varied menu of roasts from its famous carving deck. The sites are generally in suburban roadside locations.

149 sites

Premium Country pubs are a collection of individual pubs situated in both rural and suburban areas. The pubs have contemporary dining rooms and bars and many have terraces for al fresco dining.

123 sites

Vintage Inns are traditional country pubs serving freshly cooked food with a wide range of beers, spirits and great wines at fair prices.

172 sites

Mitchells & Butlers plc Annual Report and Accounts 2025 03

Introduction

Mitchells & Butlers at a glance continued

Our value proposition

Our business has unique strengths that enable us to create value for our stakeholders.

Our performance

We are a highly cash generative business with a long-term strategy to transfer debt to equity as debt

is paid down.

£16m

of cash flow generated in FY 2025

Our brands

We have a diversified portfolio of proven, established brands.

65%

65% home-grown and ohovmee-grrow7n5and%overi7n5% ein exxiisstentcee nce

for over 20 years

for over

2O0uryperoapresrty

WWee hhaavve ea fareferheoeldheosltdatee softalatregeo,f large

well-positioned pubs and restaurants

wweitlhl-hpioghsiatimoneneitdy pleuveblss. and

83%

restaurants with high amenity l8ev3e%ls.of our pubs are

forf oeurepuhbsoarledfreeahonld adnd lloongnleagsehold with major investment planned every

lseevaen syeearshold with major

investment planned eOvuer rpyeospeleven

WWeehahvae va epraovepnrsoevneionr

senior

ymeanaargsement team and depth of

mtalaennt.aHgigehmeset-envterteemapmloyee

aenngdagdemeepntthscoorfetsa. lent. Highest-ever employee engagement scores.

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Strategic Report Governance Financial Statements Other Information

Our people Our pubs

Our people are fundamental to the delivery of great experiences for our guests.

Employees

Go to page 37

1,631 managed businesses with favourable spread of locations, price points and occasions. This leaves the business well-hedged against changes in consumer taste.

50,000+

Employees making us one of the largest

employers in the industry

UK sales by region (FY 2025)

Scotland 5%

North East 3%

North West

10%

Yorkshire and

Humberside 8%

East Midlands 5%

West Midlands

15%

Wales 4%

East of

England

8%

London

21%

South West 7%

South East

(excluding London) 14%

9%

Retail staff turnover reduced by 9 percentage

points to 55% due to the effective delivery of our People Promise

1,560+

Apprentices currently in learning

Mitchells & Butlers plc Annual Report and Accounts 2025 05

‌Introduction

06 Annual Report and Accounts 2025 Mitchells & Butlers plc

Strategic Re sort

Governance

Financial Statements Other Information

Our purpose is to be the host of life's memorable moments, bringing people and communities together through great experiences.

We are pleased with our performance over the year,

in which we remained consistently ahead of the market, across all market segments. Sales growth has been broad-based, with strong like-for-like performances

in both food and drink across our portfolio of brands, supported by cost efficiencies and a capital programme which continues to deliver strong returns.

We remain committed to our Ignite programme of initiatives and our successful capital investment programme, driving further cost efficiencies and

increased sales. We have confidence that continued focus on effective delivery of our strategic priorities will generate further value from our enviable estate portfolio and customer offers and give us a strong foundation for continued longer-term outperformance.

Sustainability and respect for the environment remain central to everything we do, with some notable progress during the year, including investment in removing gas as an energy source from our estate as well as a significant reduction in waste to landfill.

Our purpose is to be the host of life's memorable moments, bringing people and communities together through great experiences. We will achieve this through the successful implementation of our three-pillar strategy which has delivered significant business improvement over the past ten years. Over the next few pages, we examine this strategy in detail, illustrating it through the work done by our teams to delight our guests and build a sustainable business during 2025.

PPhhiill UUrrbbaann, Chief ECxheiecf uEtxievceutive

‌Introduction

Strategy in action

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Strategic Report Governance Financial Statements Other Information

projects

investment projects in FY 2025

in Financial

Year 2025

216 investment

Year 2025

oinvuesrteed isn otuar etestatienin FFY 2in02a5 ncial

invested in

181 Million Pounds

At Mitchells & Butlers, we maintain a balanced and high-quality estate of pubs, bars, and restaurants across a stable of leading brands.

Our diverse portfolio of brands and prioritisation

of capital investment enables us to maximise the value of our enviable estate.

Our estate is 83% freehold, giving us a strong foundation for long-term value creation. This ownership model enables us to invest with confidence, driving returns through our targeted capital programme while improving amenity levels and overall guest experience.

We have targeted a seven-year cycle of reinvestment, ensuring we continually raise the average quality of our amenity and keep each brand feeling fresh, relevant, and competitive in its market. Each year, we evolve our pricing, product ranges, service styles, and team training within each brand format. This ensures we preserve the distinctive identity of each offer while benefiting from the economies of scale and operational excellence that Mitchells & Butlers provides.

We remain confident in our ability to generate strong returns from capital investment while enhancing the quality, relevance, and sustainability of our estate. By combining disciplined asset management with innovation and brand stewardship, we are well-positioned to deliver continued growth and long-term value for shareholders.

Introduction

Strategy in action continued

Capital investment -a key driver of growth

Capital investment is a central pillar of our value creation strategy.

Our aspiration is to maintain a seven-year cycle of investment across the estate, with flexibility built in where trading performance or condition

justify it. This ensures we invest where returns are most compelling while maintaining high overall amenity standards.

In FY 2025, we invested £181m in capital projects, delivering 212 remodels and conversions, and 4 acquisitions as well as continued strategic maintenance across the estate. These investments are currently delivering excellent returns. Our capital programme is a key driver of continued like-for-like sales growth and incremental profit.

Our broad brand portfolio gives us strategic flexibility. Where needed, we can reposition or convert underperforming sites into higher-performing formats, ensuring the estate is optimally configured by brand and location.

In addition to brand-focused projects, our capital programme includes investment in kitchen equipment, technology upgrades, and essential maintenance, all of which support operational resilience and guest satisfaction.

incremental return on expansionary capital

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Strategic Report Governance Financial Statements Other Information

Investing in a more sustainable estate

Environmental responsibility is deeply embedded into our capital programme, with sustainability considerations factored into every investment decision.

We are making significant progress against

our Net Zero roadmap through comprehensive upgrades to our buildings, kitchens, and energy systems.

This year, we installed solar panels at 93 sites, generating renewable energy on-site and reducing our reliance on the grid. We have also taken decisive steps to reduce our reliance on gas as an energy source across parts of the estate which is a key priority for reducing emissions.

Currently, we operate 100 sites with all-electric kitchens, and 24 sites have fully transitioned away from gas in favour of renewable electricity.

In addition to these energy-focused initiatives, our commitment to sustainability extends to the efficient reuse and recycling of equipment and furniture. Through our capital and maintenance investment plans, all surplus kitchen equipment is recycled, with over 1,270 pieces of equipment refurbished and reused over the last five years.

We also prioritise the upcycling, recycling, and refurbishment of existing internal furniture as part of our capital project investments. This approach has enabled us to fully furnish two sites with upcycled furniture, saving hundreds of pieces from waste.

sites with all-electric kitchens

Furthermore, the reuse of existing IT equipment, including tills and PDQ machines, has become a routine practice embedded in both planned capital projects and reactive repairs and maintenance.

Together, these initiatives not only reduce our environmental impact but also enhance energy efficiency and support long-term cost control. As part of our ongoing sustainability agenda, we will continue to invest in decarbonisation technologies and further reduce the environmental footprint of our estate.

Mitchells & Butlers plc Annual Report and Accounts 2025 11

Introduction

Strategy in action continued

12 Annual Report and Accounts 2025 Mitchells & Butlers plc

RQra ie

Governance

At Mitchells & Butlers, we are committed to instilling

a strong commercial culture throughout the business.

Our talented and dedicated team of operators is central to our success, and we are focused on equipping them with the support, information, and tools they need to drive sales growth and deliver operational efficiencies.

Our guest-centric approach is informed by robust insight and data, enabling us to make decisions that help us to consistently outperform the market and achieve best-in-class guest review scores. We understand the importance of every pound of sales converting to bottom-line profit. This commercial mindset drives

a disciplined approach to ensuring each initiative is financially well-planned, executed with rigour, and contributes to profit growth.

At the heart of this commercial culture is Ignite, our ongoing transformation programme and way of working that embraces continuous improvement. Ignite is not

a one-off project but an evolving, dynamic portfolio of 40 to 50 simultaneous initiatives that span the business, managed by a dedicated small project team.

330 Million pounds Adjusted operating profit, up 5.8% on Financial Year 2024. 4.3%

Like-for-like sales growth. (The Directors

use a number of alternative performance Adjusted operating profita, up 5.8% on FY 2024 measures ('APMs') that are considered

critical to aid understanding of

the Group□s performance. Key measures are explained on pages 189 to 191

of this report.)

Like-for-like salesa growth

a. The Directors use a number of alternative performance measures ('APMs') that are considered critical to aid understanding of the Group's performance. Key measures are explained on pages 189 to 191 of this report.

Introduction

Strategy in action continued

Ignite initiatives and the

role of continuous improvement

The philosophy behind Ignite acknowledges that there is no single silver bullet to growing profit in a business of our scale. Instead, by driving incremental improvements on multiple fronts, we achieve meaningful, aggregated results.

Examples of the areas we focus on are shown below:

Cost inflation Product development Sales

Capital investment Productivity

Data driven insights Our spaces

Stock management Loyalty

Key current areas of focus include:

Revitalising underperforming assets Through systematic efforts to reposition and enhance the lower-performing parts of our estate, we aim to unlock significant latent value.

Enhancing delivery channels

We have partnered with a well-established

third-party delivery brand to broaden our appeal and strengthen our offering in the growing delivery market.

Harnessing AI technology

We are exploring AI applications to improve guest experiences, especially focusing on optimising the booking journey to increase conversion rates and reduce lost leads.

Optimising table management

Using advanced software to maximise table turns during peak times, ensuring we get the most out of our trading hours.

A recent launch under Ignite was our new employee app, which centralises access to payslips, benefits, and internal communication.

We have also increased our focus on the drinks side of the business, including optimising beer front layouts across sites, improving cellar practices, and perfecting serves. We anticipate these efforts will rapidly contribute to bottom-line improvement.

Capital expenditure projects are undergoing a detailed review to improve efficiency and reduce costs. This includes analysing project timelines, minimising closure and reopening days, and managing reopening costs such as training and launch activities. We are also scrutinising sites that have underperformed relative to post-investment expectations to inform future decisions.

Our commitment to sustainability is integral to Ignite. Environmental impact reduction initiatives focus on lowering water consumption, identifying key measures to achieve this, and delivering both cost savings and improved efficiency.

Sustainability also involves changing on-site behaviour around waste segregation compliance and resource conservation. We support this through a dedicated network of sustainability ambassadors who drive engagement and cultural change.

Sustainability

Better bevs

Training

Ignite initiatives currently underway

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Strategic Report Governance Financial Statements Other Information

Cost controls and commercial discipline

A vital pillar of our commercial culture is rigorous cost control combined with operational discipline.

A vital pillar of our commercial culture is rigorous cost control combined with operational discipline. Ignite has equipped our General Managers with enhanced tools and systems that enable more effective labour management, including a sophisticated rostering system designed to align staffing with demand patterns and reduce labour costs without compromising service quality.

Stock control has improved significantly, with tighter procedures reducing waste and shrinkage. Rationalising our product procurement has allowed us to reduce overall stock holdings, freeing up capital and improving cash flow.

Additionally, better access to central suppliers has enabled us to curb petty cash expenditure and strengthen financial oversight across the estate.

Our people remain fundamental to our commercial success. Their delivery of exceptional guest experiences underpins our profitability.

We are proud to report our highest ever engagement score, alongside record low turnover rates. These metrics reflect a workforce that is motivated, aligned with our commercial goals, and committed to driving the future success of Mitchells & Butlers.

Through continuous reinforcement of commercial discipline, combined with targeted Ignite initiatives, we are building a resilient, profitable business

that balances growth with efficiency. This dual focus enables us to enhance guest satisfaction, grow market share, and deliver long-term shareholder value.

year-on-year reduction in energy consumption

percentage points reduction in retail staff turnover

Mitchells & Butlers plc Annual Report and Accounts 2025 15

Introduction

Strategy in action continued

16 Annual Report and Accounts 2025 Mitchells & Butlers plc

consumer needs. Embracing technology plays a critical role in this journey, allowing us to enhance operational efficiency and elevate the guest experience. Our comprehensive digital strategy aims to engage consumers

Rarea ie o t

Governance

Financial Statement s Other lnfiirnaatiun

We are also dedicated to fostering new product and

segments, ensuring they consistently meet evolving

improving how we target and engage with different customer segments.

on 4.6 average guest review

score out of 5

Introduction

Strategy in action continued

Optimising business performance through technology

In the last few years, we have introduced a significant amount of new technology, from online booking engines;

to auto-ordering which helps to minimise instances of stock outs and minimise waste; to a new labour rostering system which ensures we have the right number of team members working depending on the day's trading pattern, as well as order and pay-at-table systems.

Digital marketing and guest feedback

We are also focused on making digital marketing an engine room for the business with a consented database of 13.9 million guests. In 2024 we launched My Account which allows guests to have a single portal to access their bookings, orders and offers from multiple brands. We already have 5.6 million consented guests signed up to this, with a far younger profile and an increased frequency of visit.

The day-to-day operation of the business has rapidly changed over recent years and will continue to do so, and each of these tools therefore still has significant potential for further enhancement. Technological innovation also contributes towards our sustainability goals; this year we expanded our use of the Internet

of Things which allows us to remotely control high energy consumption equipment in our businesses, delivering significant cost and emissions reduction.

loyalty programmes offered currently

We continuously evolve in this space, with ongoing projects including a significant upgrade to our CRM system; a trial of a third-party delivery brand and more points-based loyalty schemes to further incentivise repeat customer engagement and strengthen brand loyalty.

We use technology to collate guest feedback and to inform menu development by analysing large quantities of data to spot trends in relation to dish choice and then make menu changes to satisfy guest needs.

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Building a culture of innovation

We have a culture which embraces new product and new concept development.

The Ignite programme has developed our organisational skills to deliver business change. Our teams have become adept at handling change, embracing new technology and adapting to new challenges and processes. Each of our brands constantly evolves, as do our product ranges, stretching our offering and ensuring we are quick to market to capitalise on market trends. We work closely with our suppliers in the space, having a valuable symbiotic relationship with them in terms of testing new ideas quickly. This year, for example, we changed the packaging of a soft drink from glass bottles to cans, contributing to our sustainability efforts as glass packaging has higher associated emissions as well as delivering commercial benefits.

sites with Internet of Things capability

Mitchells & Butlers plc Annual Report and Accounts 2025 19

Introduction

Strategy in action continued

forcomm

20 Annual Report and Accounts 2025 Mitchells & Butlers plc

Strategic Report Governance Financial Statements Other Information

Our partnership with Social Bite: taking action to end homelessness.

At Mitchells & Butlers, caring for our community is one of the core pillars of our sustainability strategy.

Since 2020, we have proudly partnered with Social Bite, a charity and social business dedicated to tackling homelessness across the UK. They provide homes, jobs, food and support to empower people to transform their own lives. Together, we've raised over £1.2m through the incredible fundraising efforts of our people - an achievement that also unlocked an additional £500,000

contribution from Mitchells & Butlers to support Social Bite.

Our partnership goes beyond fundraising. We are deeply committed to creating real change by providing employment opportunities, supporting the development of new homes, and helping deliver vital food services to those in need.

HHooww wweehheleplpSoScioacl BiaitleBite

Jobs

Homes

Social Bite's innovative villages provide supported housing where people can rebuild their lives in a safe, nurturing environment. We are exploring opportunities to help bring this model to the Midlands, alongside the villages already operating in Edinburgh, Glasgow, and Dundee.

Food

Social Bite uses food not just to nourish but to connect and engage. Their coffee shops distribute over 150,000 free meals annually to those impacted by homelessness, and we support these efforts alongside local food projects aimed at helping vulnerable people in our communities. Customers are invited to "pay it forward" meaning that as well as buying their own hot drink, sandwich or cake, they make a donation for someone else to enjoy a meal at one of the Social Bite coffee shops. We are working with Social Bite to open a coffee shop in Central Birmingham in 2026.

Looking ahead

We are proud of what we have achieved with Social Bite so far, but our work is far from done. By continuing to invest in fundraising, employment opportunities, and community projects, we are determined to break the cycle of homelessness

JoUbnesm: pUlonymeemntpislodyismproepnorttiiosnadteislyphrigohpeor frotriopenoaptleewlyhohighaendr build a better future for our people, our communities,

have experienced homelessness or are currently homeless,

and those who need us most.

for people who have experienced homelessness

with just 6 in every 100 in a job, compared to 70 in every 100

ofroar trhee gceunerrrael npotlpyulhatoiomn. eToledsatse,, twhriotuhgh Social Bite's

juJsobts6Firisnt perovgerarymm1e0w0eihnavae pjolabce,dc3o6mpepopalreewdhotohave experienced homelessness into roles within our venues 7a0crionsseLvonedroyn1an0d0Scfootrlanthd.eWgeepnroevirdaelopngoopinuglasutpioponr.t

Tfoordboattheo,utrhnreowutegahm SmeomcbiaerlsBanitdem□ansagJeorsb, esnsuring everyone has the tools to succeed. We're excited to expand Ftihrsistpprorgoragmrmame fumrtehewr aecrohssaovuer epstlaatec.ed 36 people

who have experienced homelessness into roles within our venues across

London and Scotland. We provide ongoing support for both our new team members and managers, ensuring everyone

has the tools to succeed. We□re excited to expand this programme further across our estate.

donated to Social Bite, £1.2m through employee fundraising with a further £500,000 unlocked from Mitchells & Butlers.

Introduction

Strategy in action continued

Comfort Mensah's Story:

how a job at Harvester made a difference

"Social Bite and Harvester didn't just give me a job, they gave me confidence and independence.

With weekly support from my Development Worker and encouragement from my manager, I was able to build a future I never thought possible.

Comfort Mensah's journey with us began at a time when she faced an uncertain future.

A master's student from Ghana, she had been staying with a family temporarily, but the arrangement was coming to an end, and the prospect of rough sleeping loomed. With only

£500 saved, Comfort was desperate to find stable work and housing as winter approached.

When Comfort learned about a job opening at Harvester specifically designed for people who had experienced or were at risk of homelessness, she took a chance and applied. What followed was a lifeline. Social Bite connected her with Ambreen, a Development and Support Worker who guided her through the interview process and checked in with her regularly. This personal support helped Comfort build confidence and navigate challenges she had never faced before.

Her manager, Mel, at Harvester saw her potential from the start, welcoming her warmly and ensuring she had the training and encouragement needed to thrive. Comfort recalls her excitement when she got the job and how meaningful her first pay cheque was. It wasn't just income, it was a symbol of independence and self-worth.

Although she had no prior hospitality experience, Comfort threw herself into her training, acing her tests and learning quickly. Her positive mindset and determination carried her through, and after a month of part-time sessions, she transitioned to full-time work.

Over the next eight to nine months, Comfort's confidence grew. With the ongoing support of her manager and Social Bite, she learned customer service skills, adapted to the fast-paced environment, and began to see herself as an important member of the team. For Comfort, the job wasn't just work, it was a pathway out of

vulnerability and a chance to build a brighter future.

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Supporting our team and managers to succeed

Chris Kelly plays a crucial role as a Development and Support Worker embedded within Mitchells & Butlers. With over a decade of experience in recruitment and employment, Chris joined Social Bite because he wanted to use his skills to make a real difference for people affected by homelessness.

Working exclusively with Mitchells & Butlers, Chris acts as a bridge between potential employees with lived experience of homelessness and our venues. His role involves understanding the culture and needs of each venue, collaborating closely with recruitment and training teams, and ensuring the Jobs First programme fits smoothly within our business.

From the start, Chris has been fully supported by Mitchells & Butlers' internal teams, including recruitment and training partners, which has allowed him to immerse himself fully in the organisation's culture. This integration means Chris can offer tailored support that meets both the needs of our new team members and the expectations of managers and colleagues.

A big part of Chris's work is being a visible presence on the ground. He supports candidates through the entire recruitment journey, from application to settling into their roles, and is always available to advise managers and staff.

Chris actively dispels myths around homelessness, promotes inclusion, and encourages teams to see the value that Jobs First employees bring.

Through his work, Chris has witnessed remarkable transformations as individuals gain confidence, complete training, and develop personally and professionally within Mitchells & Butlers.

people employed in Jobs First programme to date

Mitchells & Butlers plc Annual Report and Accounts 2025 23

‌Introduction Strategic Report

Chair's statement

Despite a persistently challenging external backdrop, our business has once again outperformed the market - a testament to the strength of our offer, the resilience of our operations, and the calibre of our people.

Performance and strategy execution We are encouraged by the strong trading momentum throughout the financial year, with like-for-like sales once more exceeding sector benchmarks. This growth, combined with disciplined cost management and the positive returns from our capital investment programme, has enabled us to mitigate the impact of significant inflationary pressures and deliver

a robust financial performance.

Our focus remains firmly on sustaining the relevance, quality, and competitiveness of our brands. Continued investment in our estate ensures our offer remains fresh and compelling, while the Ignite transformation programme provides a structured and effective framework for ongoing operational improvement. This has enabled us to manage cost headwinds and drive performance across the business.

People and culture

Our people are the foundation of our success, and I am proud of the strong people metrics achieved during the year. Employee engagement is at an all-time high, and staff turnover has reduced further to record low levels - reflecting the strength of our culture and the deep commitment of our teams. These results underscore the shared ambition across our workforce and the collective drive to deliver great guest experiences every day.

Purpose and social impact

Our purpose - to be the host of life's memorable moments, bringing people and communities together through great experiences - continues to guide everything we do.

The consistent outperformance of our brands compared to competitors reaffirms the strength of our proposition and our ability to deliver on this purpose.

24 Annual Report and Accounts 2025 Mitchells & Butlers plc

Governance Financial Statements Other Information

We remain committed to creating positive social impact. Our partnership with Social Bite, a social enterprise addressing homelessness, has continued to flourish. Social Bite distributes almost 150,000 free meals annually to those

impacted by homelessness, and we support these efforts alongside local food projects aimed at helping vulnerable people in our communities.

We have also partnered with Social Bite to expand their Jobs First initiative, which supports individuals into long-term employment. To date, this programme has helped over 30 people begin new careers within Mitchells & Butlers - and we are ambitious to expand this important partnership

in the years ahead as well as developing various longer-term housing projects.

Our values

Our values - Passion, Respect, Innovation, Drive and Engagement- shape our culture and define how we operate as a business. They underpin how we work together, how we serve our guests, and how we build trusted relationships with stakeholders across our communities and markets.

Board governance

There have been no changes to Board composition during the year.

However, earlier in the year, and after a distinguished tenure as Chief Financial Officer, Tim Jones indicated to the Board that he was contemplating retirement. Following an extensive search and selection process for a successor this will now be effective in Summer 2026. On behalf of the Board, I would like to extend our sincere thanks to Tim for his exceptional contribution to Mitchells & Butlers over the past 15 years. His financial leadership, professionalism and integrity have been instrumental to the Board in strengthening the business and guiding it through some of the most challenging periods our industry has faced. We wish him every success and happiness in his well-earned retirement.

We welcome Emma Harris to the Board as our next Chief Financial Officer. She joins us from Marks & Spencer Group plc where she is currently Finance Director - Food, bringing a wealth of experience in financial leadership and a strong track record in driving performance. I look forward to working with her as we continue to build on our strong foundations for future growth.

Further detail on the operation of the Board can be found in the Governance section on page 65.

Looking ahead

Mitchells & Butlers has once again demonstrated its ability to navigate uncertainty and deliver consistent performance. While the macroeconomic environment remains challenging, we enter the new financial year with confidence - supported by a clear strategic direction, an exceptional team, and a compelling brand portfolio that continues to resonate strongly with guests and generate value for shareholders.

On behalf of the Board, I would like to thank all of our colleagues for their passion, commitment, and contribution over the past year.

Bob Ivell

Chair

Mitchells & Butlers plc

"I'm pleased to report another year of strong progress, as our management team has continued to execute against our strategic objectives with discipline and focus."

Bob Ivell

Chair

Mitchells & Butlers plc Annual Report and Accounts 2025 25

‌Introduction Strategic Report

Chief Executive's business review

Business review

Total sales across the period were £2,711m reflecting 3.9% growth on FY 2024. Like-for-like salesa increased by 4.3% with strong performances through the brand portfolio.

Adjusted operating profita of £330m was 5.8% growth on last year (FY 2024 £312m) and a 0.2ppt increase in adjusted operating margin to 12.2% (FY 2024 12.0%).

We made a good start to the year with like-for-like salesa growth of 4.0% over the first seven weeks. Performance over the important three-week festive period was particularly strong with

like-for-like salesa growth of 10.4%. Across the first quarter as a whole, like-for-like salesa remained well ahead of the marketa, growing by 3.9% despite the notable adverse, albeit temporary, impact of very cold and stormy weather over the last couple of weeks.

Sales remained resilient through the second quarter aided by good weather in late March, and with a particularly strong performance on Mother's Day. Across the quarter, we recorded like-for-like salesa growth of 4.7%.

Third quarter growth remained strong and benefitted from the movement of Easter into the second half, with like-for-like salesa growth of 5.0%.

Fourth quarter like-for-like salesa growth of 3.2% reflected robust performances in mid-market pub and pub restaurants balanced against slightly weaker sales in London within the M25 and in more premium businesses.

We have continued to consistently outperform the marketb, as represented by the CGA Business Tracker, by c. 3% over the financial year. Across the market segments reported on by CGA Business Tracker, Pubs and Pub Restaurants have seen the highest sales growth across the year, benefiting from periods of warmer weather.

26 Annual Report and Accounts 2025 Mitchells & Butlers plc

Governance Financial Statements Other Information

The Restaurant segment has delivered broadly flat sales, which we have consistently outperformed.

Bars have reported sales decline, with the

late-night market being particularly challenged. This is the segment that we have least exposure to, but again we have outperformed significantly, with our offers appealing across a range of occasions with less exposure to late-night trade.

Cost inflation headwinds over the financial year were in line with guidance at £100m, driven primarily by increased labour costs (including increased national insurance contributions which impacted the second half) and against a backdrop of stabilisation of overall energy costs. Strong and resilient sales growth, combined with effective delivery of our Ignite and capital programmes, have driven an increase in both profitability

and margins.

The macro pressures impacting the sector have resulted in a decline in the number of licensed outlets of 0.5% in the year to June 2025, after a period of relative stability during 2024. Leased businesses were most affected, with net closures of 3.3%. Independents reported a net reduction of 0.1% with net closures in food-led outlets offsetting growth in drink-led outlets. Managed operators marginally increased outlet numbers by 0.7% despite a reduction in food-led outlets. The reduction of outlet numbers suggests that operators in certain segments of the market are no longer able to withstand the cost pressures impacting the sector.

Our strategic priorities

Our strategy, based on three key pillars, has provided the foundation for our ongoing performance. We focus on maximising the value generated from our 83% freehold and long leasehold estate, utilising the diversity of our brand portfolio to grow market share with appeal across a broad range of consumer occasions, demographics and locations. Our range of offers is a particular strength during times of uncertainty, with familiar brands to suit a wide range of occasions, providing guests with the opportunity to adapt their drinking and eating out choices to meet their needs.

Our Ignite improvement programme of work remains a key focus for the business. The programme enables our organisation to be agile in response to the evolving external environment, facilitating change whilst maximising the power of our scale. We have around 40 initiatives underway across a range of areas, all focused

on driving sales and delivering cost efficiencies. Sales focused initiatives deliver enhanced guest experiences in a variety of ways and continue to reap rewards, reflected in sustained like-for-like salesa growth as well as continued market outperformance on guest review scores, which averaged 4.6 out of 5.0 over the financial year. During the year we have expanded our guest feedback surveys to include reviews of dishes, enabling us to use additional data driven insights to evolve our menus to better satisfy guest needs.

Enhancing productivity and efficiency to help mitigate inflationary costs remains an important focus. We have a number of initiatives in place designed to improve efficiency, including optimisation of our labour scheduling system which assists General Managers in achieving an effective balance of team to maximise sales across day parts, as well as our auto-ordering system which helps to reduce instances of stock outs and to minimise waste.

A number of initiatives deliver commercial savings whilst also contributing to our sustainability objectives. We have continued the roll out of remote control in-site energy systems which have delivered energy consumption savings across our estate. Remote control of heating, for example, provides a significant opportunity to reduce consumption whilst also relieving our managers of one of their many daily tasks, allowing them to focus on guests. In addition, during the year we realised an opportunity in packaging, following

a market transition to exchange glass bottles for cans in certain soft drinks, delivering cost savings and environmental benefits through lower emission packaging.

"Our strategy, based on three key pillars, has provided the foundation for our ongoing performance. We focus on maximising the value generated from our 83% freehold and long leasehold estate, utilising the diversity of our brand portfolio to grow market share with appeal across

a broad range of consumer occasions, demographics and locations."

Phil Urban

Chief Executive

Mitchells & Butlers plc Annual Report and Accounts 2025 27

Introduction Strategic Report

Chief Executive's business review continued

Our capital programme continues to deliver significant value through improving the competitive position of our pubs and restaurants within their local markets. We are committed to prioritising investment in our estate and this year we expanded the programme, investing £181m and completing 216 investment projects comprising 199 remodels, 13 conversions and

4 acquisitions. We are generating very strong returns, currently in excess of c. 35% on remodels, justifying an increasing allocation of capital to this area as we look to re-establish an average 7-year investment cycle.

People

Our people bring our brands to life and are critical in the success of the business. We are delighted that engagement scores have continued to improve over the period and believe this is representative of the commitment of our teams to deliver the change needed to navigate the

challenging operating environment and ultimately to drive the future success of the business.

Pleasingly, employee turnover has also continued to improve reaching record levels of 55% (FY 2024 64%) supported by improved internal succession rates, reflecting the strength of our training and progression opportunities. For a number of years, we have been able to evidence the strong correlation between employee engagement scores, guest satisfaction and sales performance and this has proven to be the case once again over the course of FY 2025.

Our sustained progress across key people metrics, despite a persistently challenging recruitment environment, underscores the effectiveness of our talent strategy - successfully attracting

high-calibre individuals, enhancing capability through structured development programmes, and supporting long-term retention via clear and compelling career progression pathways.

Sustainability

We are committed to reducing the environmental impact of our business and are pleased with the progress we have made against our challenging targets. We have committed to:

• Net Zero emissions by 2040, including Scope 1, 2 & 3

  Progress: We have reduced our total footprint by 16% from our 2019 baseline year, comprising a reduction in Scope 1 and 2 emissions of 22% driven by energy consumption reduction and reduced reliance on gas as an energy source, and Scope 3 reduction of 15% reflecting progress made in partnership with our suppliers to reduce the impact of our supply chain.

• Zero operational waste to landfill by 2030 Progress: We now divert 99% of waste from landfill and are confident of achieving our target ahead of 2030. In addition, we have increased recycling rates to 60% with enhanced segregation and a focus on engagement and behaviour change in sites.

• 50% reduction in food waste by 2030 Progress: To date we have successfully reduced our food waste by 23% from our 2019 baseline, with progress both in sites and in the supply chain. We are focused on operational practices to reduce waste and have effective partnerships in place with Fareshare and Too Good To Go to redistribute unavoidable surplus food.

We remain focused on working towards our sustainability goals, with numerous initiatives underway to support these ambitions and we were delighted to again receive the award for the Most Sustainable Pub Company at this year's Publican Awards. We have continued to invest in sustainability capital, we now have 244 sites with solar panels, and significant further opportunity to grow our production of renewable energy.

We have made good progress in the electrification of sites to reduce our reliance on gas as an energy source, having removed gas fully from 24 sites

(FY 2024 5 sites) and electrified 100 kitchens (FY 2024 60). In addition, we are investing in technology which allows us to remotely control high energy consumption equipment across the estate, opening up the opportunity for energy consumption savings without requiring intervention from our teams.

Our teams are vital to the delivery of progress. We provide support for these types of initiatives through our dedicated network of sustainability ambassadors, as well as centrally developed online training. We know that our people are passionate about improving the environmental impact of our business and are pleased to deliver continued progress in this area, further enhancing our employer proposition.

Current trading and outlook

We traded strongly throughout the year with like-for-like salesa growth of 4.3% built on strong performances across the brand portfolio. We remained ahead of the marketb in each segment

reported by the CGA Business Tracker, supported by broadly flat volumes across the period.

Combined with disciplined cost control, further Ignite efficiencies and strong returns from our capital programme, this delivered growth of 5.8% in adjusted operating profita to £330m (FY 2024

£312m) despite well publicised cost pressures.

Over the most recent 8 weeks like-for-like salesa have strengthened from the final quarter of

FY 2024, growing by 3.8% despite uncertainty ahead of the Chancellor's Autumn Budget.

Looking forward, Lumina Intelligence forecasts the UK eating out market to grow by 2.4% in 2026 (UK Eating Out Market Report, 2025), against which we expect to maintain our outperformance.

During FY 2026 we anticipate cost headwinds of

c. £130m, representing slightly less than 6% of our cost base before mitigation, driven by annualisation of labour cost increases, plus further increases in the statutory thresholds, and increased levels of food cost inflation. This includes our preliminary assessment of the impact of the Chancellor's recent Autumn Budget, pending clarification of further detail. We believe that our strong market position, together with the success of our Ignite improvement programme, should enable us to continue to outperform the sector and leave us well positioned to mitigate these increases.

We remain focused on strengthening our balance sheet, which will enhance the resilience of the Group and deliver further value to shareholders, principally through a transfer to equity. The Board do not feel that it will be efficient, particularly with regard to break costs and new debt issue costs,

to consider a reset of the capital allocation strategy of the Group within the near term. Over time, and as the securitisation matures, the Board will however continue to monitor the position and shareholder returns will be considered alongside investment opportunities.

Phil Urban

Chief Executive Mitchells & Butlers plc

1. The Directors use a number of alternative

   performance measures (APMs) that are considered critical to aid the understanding of the Group's

   performance. Key measures are explained on pages 189 to 191 of this report.

2. As measured by the CGA Business Tracker.

28 Annual Report and Accounts 2025 Mitchells & Butlers plc