PUB group JD Wetherspoon has attributed a dip in profits during its most recent trading period to rising costs.
Announcing preliminary results for the 26 weeks to January 27, the company reported a 7.1% increase in revenue (to £889.6 million) and a 6.3% increase in like-for-like sales. However, pre-tax profits dropped 18.9% to £50.3m, with operating profit down 14.2% to £63.5m.
In his chairman’s statement, Tim Martin attributed the lower profits to increases in costs including labour (an increase of £33m), repairs (up £3.7m), utilities (up £2.5m), interest (up £3.3m) and depreciation (up £2.4m).
Wetherspoon opened two new pubs and closed six during the 26-week period, bringing the total estate to 879 units, with more than 70 in Scotland.
“In the six weeks to March 10, 2019, like-for-like sales increased by 9.6%, helped by excellent weather this year and snow last year, and total sales increased by 10.9%,” said Martin.
“As previously indicated, costs in the second half of the year will be higher than those of the same period last year.
“The company anticipates an unchanged trading outcome for the current financial year.”