Wetherspoon's profits rise but pub group warns sales are set to drop
PUBLISHED: 08:57 16 March 2018 | UPDATED: 08:57 16 March 2018
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JD Wetherspoon has posted a rise in half-year profit, but warned that sales will be lower over the next six months as the pubs chain is hit with rising costs.
The group posted a 36.1% rise in pre-tax profit to £54.3m in the 26 weeks to January 28, with revenue rising 3.6% to £830.4m.
The pub chain said like-for-like sales rose 6.1% in the period, but chairman Tim Martin said that growth in comparable sales will be lower in the next six months as it stomachs an array of costs.
“The company anticipates higher costs in the second half of the financial year, in areas including pay, taxes and utilities,” he said.
“In view of these additional costs, and our expectation that growth in like-for-like sales will be lower in the next six months, the company remains cautious about the second half of the year.”
On current trading, Wetherspoon saw like-for-like sales increase 3.8% in the six weeks to March 11 and total revenue grow 2.6%, leading the group to maintain full-year expectations.
Mr Martin apologised to customers over a meat recall earlier this year which saw sirloin, rump and gammon steak pulled from the menu of the chain’s 900 UK and Irish pubs.
Wetherspoon has since cancelled its contract with the now-bust Russell Hume and is sourcing its steaks from new suppliers.
Mr Martin also used the latest trading update to launch fresh criticism aimed at the chairmen of Whitbread and Sainsbury’s, who he accuses of misleading the public by saying that food prices will rise if Britain leaves the EU without a deal.
“The EU is a protectionist organisation which imposes high taxes on food, clothing, wine and thousands of other items from non-EU countries,” Mr Martin said in another lengthy tirade that also took in criticism of the Confederation of British Industry (CBI) and the British Retail Consortium (BRC).
The Wetherspoon boss has been an outspoken proponent of Britain’s divorce from the European Union, issuing countless stock exchange announcements extolling the virtues of Brexit.