PUB group Wetherspoon has revealed significantly improved sales figures after benefiting from the Queen’s Diamond Jubilee and Euro 2012.
The group, whose 850 pubs are mainly in town centres, said the special events had a positive impact on footfall as like-for-like sales rose 6.1% in the 11 weeks to July 8, compared with a 2% rise in the previous quarter.
Wetherspoon expects a reasonable outcome for the financial year ending this month but said the main challenges facing the group were continuing cost pressures resulting from Government legislation.
It has already warned it will slow the pace of new pub openings in the next year to between 20 and 30 sites as it grapples with a £50m increase in its annual tax bill, including rises in excise duty.
Although the recent special events were a major driver of the sales boost, the chain’s chairman Tim Martin said he was hopeful that people may be starting to return to pubs following the smoking ban.
He said: “Our sales have been growing at about 2% over recent years, which is a little less than inflation, so we are glad to see a pick-up.”
“My own theory is that the industry may be starting to see a bit of a rebound after the smoking ban.
“Possibly we are now seeing a bit of a revival as smokers get used to going outside and people who don’t like smoking start to come back.”
He added that similar trends had been seen in parts of the United States where bars had taken a while to recover from smoking bans.
Martin said the Olympics may also prove to be a temporary boost to the sector, although its impact was hard to predict.
Shares rose 3% as investors toasted the trading boost.
Numis analyst Douglas Jack upgraded his profit forecast for the current year to £69.4m, which would represent a 4% increase on the previous 12 months.
But he expects like-for-like sales to slow over the following year, which would put profit margins under further pressure.