Wetherspoon sales up, sees UK prospects improving after Brexit

Pub operator JD Wetherspoon reported a rise in sales and said it expects to see an improvement in the UK’s prospects following the vote to leave the European Union.

For the 11 weeks to 10 July, like-for-like sales rose 4% and total sales were up 3.8%. In the year to date, LFL sales increased 3.4% and total sales advanced 5.5%.

In a pre-close trading statement for the year to 24 July, the company said it has opened 13 new pubs since the start of the financial year, sold 29 and closed 11. It expects to open 16 new pubs this year and said there will be around £13m of exceptional, non-cash losses, mainly associated with pub disposals and closures.

The full-year operating margin before exceptional items and before a £3.8m gain on property is expected to be around 6.8%, compared to 7.4% last year.

As far as Brexit is concerned, chairman Tim Martin said he believes the UK’s economic prospects will improve following the vote.

He pointed out the negative forecasts in the run-up to the referendum by people such as the International Monetary Fund’s Christine Lagarde and Bank of England governor Mark Carney, and said such individuals were “either dishonest, or they have a poor understanding of economics, since democracy and prosperity are closely linked and the EU is clearly undemocratic".

“By voting to restore democracy in the UK, I believe the UK's economic prospects will improve, although it is quite possible that the unprecedented and irresponsible doom-mongering, outlined above, may lead to some kind of slowdown.”

Martin said that despite these dire warnings, Wetherspoon trade strengthened slightly in recent weeks and as a result, the company now expects a modestly improved outcome for this financial year.

Wetherspoon said net debt at the end of the year is expected to be around £670m.