Pub group Mitchells & Butlers posted a solid start to the year, with stronger revenues in the run up to Christmas Reuters

Pub group Mitchells & Butlers posted a solid start to the year, with particularly strong revenues in the run up to Christmas.

It said like-for-like sales in the 15 weeks to 7 January lifted to 1.7% compared to a year ago, with a 4.7% spike in sales in the final four weeks of this period covering the festive season.

Mitchells, which owns 1,700 pubs and restaurants under such brands as Harvester, All Bar One and O'Neill's, said in September its margins will be below last year as a result of investment in its estate and the introduction of the national living wage in the second half of the year.

The Birmingham-based chain opened one new site and completed 69 conversions and refurbishments during the period. It added it expects to complete around 300 improvements to its estate this year.

The FTSE 250 business has previously admitted that it let its pub estate had become tired, leading to a drop off in trade.

Chief executive Phil Urban said: "This is an encouraging performance, building on positive momentum from earlier in the year.

"We are starting to benefit from the many initiatives we continue to put in place, which gives us confidence in successfully delivering our strategic priorities going into the new year and a performance in line with the board's expectations."

Shore Capital analyst Greg Johnson said: "The update is reassuring given concerns over the trading backdrop, although the group continues to caution over margins, and suggests that the group continues to make progress on its strategy to deliver improved sales growth."

Analysts at Panmure Gordon expect the firm to report a full year pre-tax profit to fall 2.7% to £179m compared to a year ago.