Pub operator J D Wetherspoon has posted an impressive 28% rise in profit (before deductions), with like-for-like sales up 4% over the past year.
But it is getting ready for tougher times ahead, with the hospitality industry fearing that customers will start to rein in spending in the face of rising inflation.
Fiona Cincotta, a senior market analyst at City Index, told Beer Today: “Profits have come in at the top end of market expectations after the company incurred smaller non-cash losses associated with pub closures than it had expected.
“The closure of those poorer-performing pubs has helped expand the operating margin, which met the mid-range of company guidance.
“More crucially, the improvement in like-for-like sales growth reported in previous trading updates has continued into the first weeks of the new financial year.
“That’s positioned the company well to build on last year’s profit, though management is rightly cautious about the prospects of such rapid sales growth continuing unabated.”
