Cost hikes take froth off Wetherspoon's sales jump
Pubs group JD Wetherspoon - which was founded by chairman and Northern Ireland man Tim Martin - has posted more sales growth, but warned over rising cost pressures and a squeeze on customer spending power.
Like-for-like sales were up 2.4% in the 13 weeks to April 24, leading to a 2.4% increase over the 39 weeks to the same date.
In a brief trading update, the company said it "continues to be faced with rising costs for a wide range of goods and services" combined with a drop in disposable income for its customers. Wetherspoon, which has 800 pubs, is being buffeted by increased taxes, labour costs and rising prices relating to utility bills and bar and food supplies.
But the company continues to expand, opening 29 new pubs since the start of the financial year.
It aims to open 50 in the current financial year. Wetherspoon recently warned prices in its pubs and those across the industry would need to rise by around 4% to combat inflation.
This comes on top of a 3% to 4% hike in October, introduced after Wetherspoon faced price increases from suppliers.
Chairman Tim Martin said the company had brought in a wider spirits range, a beer festival and an improved menu in order to pull in customers.
"The industry is under extreme pressure," he said. "This is not change for change's sake, we're trying to make the company better."