Profits fall for Wetherspoon
PUBS chain JD Wetherspoon, which employs around 360 staff on Teesside, today reported a fall in annual profits after stronger food sales failed to offset a decline in their drinks trade.
The group achieved profits for the year to July 27 of £55m, a decline of 11.4% on a year ago after like-for-like sales declined 1.1%.
But Wetherspoon said the new financial year had started positively, with the comparable figure 1.1% higher and total sales up by more than 5%.
Faced with rising energy, food and labour costs, Wetherspoon warned it would need to grow like-for-like sales by 3% this year to achieve a similar trading performance in the current financial year.
The chain owns almost 700 pubs in the UK and is behind eight pubs in the Tees Valley, including The Thomas Sheraton in Stockton, The Plimsoll Line in Redcar, The Tanners Hall in Darlington and The King John’s Tavern in Hartlepool.
Each of its pubs employs 40-50 staff.
Today’s figures represent the first full year of trading since the introduction of the smoking ban in July 2007.
The group has also been “strongly affected” by increases in taxation and regulation, which it claimed had a far greater impact on its business than energy bills.
It said: “In the current financial year, we continue to estimate increases in excise duty on alcoholic drinks, minimum wage related costs and increased statutory holiday entitlements will amount to £16m.”
The company opened 23 pubs during the year, compared with 18 in the previous year. It aims to open around 30 pubs in the year ending July 2009 - a rate of expansion it plans to continue in the future.
It has identified a number of North-east sites including Redcar and Spennymoor which require planning and licensing permission.
“The North-east is an area that has traded well. We’re always looking for sites,” said Keith Down, finance director.
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