Pubs to close earlier to avoid levy
Pub chain JD Wetherspoon is to cut the opening times of its outlets at the weekends in response to late-night levies being introduced by local councils.
The group, which saw its like-for-like sales lift 4.9% in the 10 weeks to July 6, said the late-night levy which can be imposed by local authorities on licensed premises after midnight is an unfair tax burden on publicans.
Chairman Tim Martin, who founded the company in 1979, said "almost all" of the firm's pubs open until 1am on Fridays and Saturdays, but they will now close early in areas where the levy is introduced.
The levy, designed to pay for late-night policing, ranges between £299 and £4,400 a year depending on the value of the property.
Mr Martin said: "It is not economically viable for us to be open for those two hours over the weekend. Pubs already pay a heavy tax burden compared to other types of businesses."
The levy has been introduced in Newcastle and Cheltenham and will soon be introduced in the City of London and Islington, with JD Wetherspoon saying it will seek to cut back its opening hours in each case.
JD Wetherspoon, which runs 930 pubs, added that its like-for-like revenues over the last 49 weeks rose 5.4%.
The group said its sales over the World Cup were "slightly weaker", although it does not brand itself as a sports pub. It banned TVs from its outlets for many years and even now usually has them on with the sound turned down.
The business opened its first pub outside the UK yesterday, in Blackrock, Ireland. It plans to open up to 40 pubs in Ireland over the next 10 to 15 years.
In the UK, the business has opened 45 pubs in the current financial year to the end of July, to be followed by between 30 and 40 in the next year.
JD Wetherspoon, which posts its full-year results on September 12, said although sales have slowed in recent weeks, it remains "confident of a reasonable outcome" in the current financial year.
Brokers at Shore Capital trimmed their 2014 forecast for JD Wetherspoon by £500,000 due to margin concerns and expect it to report a pre-tax profit of £77.6 million.