Wetherspoon hopes to ‘break even’ this year, but cautions over cost woes
The pub chain said it had returned to profit since March 13 and is hopeful of a further gradual improvement in sales over its final quarter.
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Your support makes all the difference.Pub giant JD Wetherspoon has said it expects to break even this year after returning to profit in the third quarter, but flagged “considerable” pressure on costs as staff and energy bills jump.
The chain said like-for-like sales in its third quarter to April 24 were 4% below the same period in 2019 before the pandemic struck, but bounced back to stand slightly higher in the final two weeks.
It said it had returned to profit since March 13 and is hopeful of a further gradual improvement in sales over its final quarter.
The figures come after half-year results in March showed it remained in the red with a pre-tax loss of £21.3 million for the six months to January 23.
Chairman Tim Martin said: “The company anticipates a continuing slow improvement in sales, in the absence of further restrictions, and anticipates a ‘break-even’ outcome for profits in the current financial year.”
He said the group is “cautiously optimistic about the prospect of a return to relative normality” in the next financial year, but warned over rocketing inflation.
“As many hospitality companies have indicated, there is considerable pressure on costs, especially in respect of labour, food and energy.
“Repairs are also running at a higher rate than before the pandemic.”
Shares in the firm fell 3% in morning trading.
Britain’s hospitality sector is slowly recovering after a series of Covid lockdowns hammered trading.
Sales are now bouncing back, but firms are dealing with the next crisis as the Ukraine war compounds already sky-high inflation.
Rising staff wages, eye-watering energy bill increases and higher food costs are all conspiring to take their toll on hospitality companies.