Wetherspoon says cheers to 15 per cent profit increase

A UK pub chain has announced a dip in sales following a 15 per cent increase in profits.

J D Wetherspoon reported that its profits for the first half of the financial year increased by £7.6m, going from £50.3m to £57.9m.

The company also reported that despite coronavirus worries, its sales increased by 2.9 per cent in the six weeks to 8 March.

However, following this, sales have declined at a “significantly higher” rate.

Tim Martin, chairman of J D Wetherspoon, commented: “It is obviously very difficult to predict, in these circumstances, how events will unfold in future weeks and months, but we now anticipate profits being below market expectations, so long as the current health scare continues.

“As a result of this uncertainty, it is impossible to provide realistic guidance on our performance in the remainder of the financial year.

“The company has decided to delay most capital projects and to reduce expenditure, where possible, including the cancellation of the interim dividend.

“ As a result of these actions, combined with the government’s proposals on business rates relief and credit guarantee facilities, the company believes it has sufficient liquidity to maintain operations at a substantially lower level of sales.

“As many companies and commentators have noted, the current health crisis places the hospitality industry, in particular, under great pressure.

“Wetherspoon, like our peers, will be working closely with all parties, including employees, banks, landlords and suppliers, in order to emerge from the situation in the best shape.”

Earlier this week, the chairman commented on the government’s measures to tackle COVID-19’s spread.

“I believe the government will make a tactical error in resorting to de facto “lockdown”.

“The Dutch position of frankly admitting that most people will get the virus, while protecting the elderly and sick, thereby building up group immunity, is the best path for the UK.

“As scientists have said lockdown for twelve weeks results in a further breakout of infections in July.

“The difference in keeping the hospitality industry open, even with reduced sales, is colossal.

“The industry contributes £120bn a year of tax and six million jobs. Wetherspoon alone contributes £2m a day of tax.

“Lockdown delays the inevitable and destroys the tax base at the same time, which will cripple the NHS and the economy.”