JD Wetherspoon, the high-street pub operator, has seen its full-year profits nosedive in what its chairman has described as a “traumatic year” for the pub industry.
The company, which opened 23 new sites in the year to 27 July, to take its total to 694, saw pre-tax profit slide 12.7% to £54.2m in its first year’s trading since the start of the England smoking ban.
Turnover increased 2.1% to £907.5m but a shift from high-margin drink sales to lower margin food sales (now accounting for 29% of total sales) put increasing pressure on margins as did an increase in industry taxation and regulation.
Despite this Wetherspoon reported good trading in August with like-for-like sales up 1.1% and total sales ahead at 5.5%. It plans to open 30 new pubs in its new financial year.
Tim Martin, chairman of Wetherspoon, said: “In a traumatic year for the pub industry following the smoking ban, Wetherspoon has again demonstrated that concentrating on customer service, standards and placing emphasis on staff training and incentives, are the key ingredients to long-term success, especially during a downturn in the general economy.”
The results bring to an end a bad week for the pub industry, which began with calls of the sector being in crisis and saw both Greene King and Punch Taverns report slides in sales.
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By Chris Druce
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