The pub group, JD Wetherspoon, has recorded a moderate growth for the first half of 2012 with an increase in sales of 8.4 per cent, given the pressures on the UK consumer.
Total sales including new pubs, increased to £569.4 million, compared to £525.4 million for 2011. Profit before tax and exceptional items for the same period increased by 11.1 per cent to £35.8 million.
The biggest high street pub chain in the UK, is concerned by the level of taxes and by their continuing increases, especially since supermarkets pay virtually no Vat, in respect of food purchases, while pubs pay 20 per cent, in effect creating an enormous tax advantage for supermarkets, enabling them to cross-subsidise drinks prices. Over the period, pubs have lost approximately half of their beer sales to supermarkets.
Wetherspoon's profit earnings per share before exceptional items rose by 22.4 per cent to 20.2pence. The board also declared an interim dividend of 4 pence per share for the current interim financial period ending 22 January 2012.
While commenting on the interim results, Chairman Tim Martin said: "The outcome for the first half of the financial year was reasonable, given the pressures on the UK consumer. As previously stated, the main challenges for the company, will be the continuing cost pressures resulting from government legislation, including increases to excise duty, business rates and carbon tax. Sales since our 18 January 2012 pre-close statement have been disappointing, with like-for-like sales in the six weeks to 4 March declining by 0.7 percent and total sales increasing by 6.1 percent. As previously stated, we expect the operating profit margin before exceptionals to decline in the second half of this financial year due to continuing cost increases, with the current quarter particularly affected. We are, therefore, slightly more cautious about the potential outcome for the current financial year."