The All Bar One pub chain is owned by M&B

The group, which owns the All Bar One and O'Neills pub brands, reported half-year profits before exceptional items of �88m ($155.6m).

M&B said the profit drop was due largely to higher costs - up �8m - following a rise in the minimum wage.

But the group, created from the demerger last year of Six Continents, said its sales growth remained strong.

Solid outlook

Underlying sales rose 5.3% for the first 32 weeks of M&B's financial year, including the Easter holiday period.

The Birmingham-based group, which manages more than 2,000 outlets including Harvester and Vintage Inns, said turnover was also up 4% to �823m.

Chief executive Tim Clarke said the M&B's strategy was to generate "good like-for-like sales growth and a solid operating performance".

On an operating basis, profits at the group during the half-year period rose by 2% to �140m.