Wetherspoon quality draws ‘trendy types’
JD WETHERSPOON beat tough competition in the casual dining market with tasty half-year profits as cheap drinks and food deals pulled in the punters.
While Jamie’s Italian, Byron and Prezzo have closed outlets after struggling with high costs and a squeeze on consumer spending, Wetherspoons founder, Tim Martin, said his no-frills pubs have become “fashionable”.
Food sales at the FTSE 250 group, which has 886 watering holes, were up 6.9 per cent in the 26 weeks to January 28 as overall like-for-like turnover grew 6.1 per cent and pretax profit jumped 36.1 per cent to £54.3million.
Martin said: “A lot of trendy-type, restaurant-type companies have all opened up at around the same time in the last 10 years, pay huge rents and the glitter has worn off a bit and they’ve suffered a backlash from customers.
“It is a tremendous market for people going out, but it may be that too many have opened up in the same places. Some are perhaps too cloned and lack any individualism.
“The likes of Greggs, McDonald’s and ourselves are doing well. Maybe people think there has been a little bit of effort put into our pubs.”
Martin does not expect the same growth in the year’s second half. Like-for-like sales growth slowed to 3.8 per cent in the six weeks to March 11, and the company is also braced for higher costs from wage increases, taxes and utility bills.
Wetherspoon, whose best-selling brand is Lavazza coffee at a million a week and whose biggest draft product is Pepsi, will raise the price of sugary drinks by 10p to offset the £3-4million cost of the sugar tax.
Brexiteer Martin continued to hit out at “misleading” claims by the likes of the CBI and British Retail Consortium that food prices will automatically rise if the UK leaves the EU without a deal.
He also dismissed as “a fallacy” arguments that the EU economy would be better able to withstand a standoff than the UK, warning that imports such as prosecco and champagne could suffer as consumers switch to New World wines.
He added: “Most economists who criticise Brexit use hypothetical arguments but, in the real world, the UK can eliminate import taxes, improving living standards and simplifying the Byzantine tax system – both of these factors will improve the outlook for consumers and businesses in the UK.”