Wetherspoon reports decline in sales |
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Thu, 03 Nov 2005 07:05
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Pubs chain JD Wetherspoon reported a decline 0.9 per cent in its first-quarter like-for-like sales on Tuesday. The total sales, however, registered a rise of 0.5 percent to 201.5 million pounds.
Margins increased in the 13 weeks to October 23 compared the same period a year ago as a result of cost cutting in the pubs. It reported pretax profits in September before exceptionals of 46.1 million pounds for the year to July 24 taking into account overall sales which were up by 3 per cent.
Though the group showed a good trading performance in the first quarter, it is early days for revising full year predictions. Other factors, which could impact its sales, would be continuing pressures on cost, longer trading hours and the forthcoming World Cup soccer tournament.
The pub chain has decided to keep majority of its 650 outlets open by an extra hour to midnight on weekdays, and on Friday and Saturday nights it would be open for two hours more. New licensing laws come effective from November would mean that almost all of its outlets open at 0900 hours.
The pub operator reported that sales in its 47 non-smoking pubs declined by 7.3 per cent in the quarter. This augurs tough times in future when non-smoking legislation comes into effect. The food sales had increased in the smoke-free outlets, though the bar sales declined sharply. Wetherspoon is to ban smoking in all of its pubs by May 2006.
Shares in Wetherspoon were down 0.85 percent by 1445 GMT at 293 pence, which values the chain at around 518 million pounds.
Chief executive Tim Martin, expecting a steadying of the market said: “We think in year one of the ban British pubs will be down 5% to 10% and will improve thereafter.”
Interim results are to be out in March 2006.
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JD Wetherspoon 