JDW business steady, with 23 new pubs open

July 17, 2008: Good marketing has helped JD Wetherspoon to a "satisfactory" performance so far this year, the company reporting a like-for-like sales increase of 0.4% in the 11 weeks to July 13.

The company reported on March 7 that it expected second half sales trends to be broadly similar to those of the second quarter, when like-for-like sales declined by 3.1%. Actual sales, it reports now, have been ahead of this, due in part to marketing activity and it considers the outcome a "satisfactory performance in the current environment".

The company remains in a sound financial position, it reports, and continues to generate strong free cashflow. In the current financial year it has financed cash dividend payments of £17 million, share buy-backs of £12 million and the opening of 23 new pubs, with a minimal increase in debt.

After a slow second quarter, when like-for-like sales declined by 3.1%, sales in the last 24 weeks have been approximately flat, in line with record sales last year. Expectations for the financial year remain unaltered.

"In the next financial year (commencing July 28), in common with other pub and restaurant businesses, we continue to expect a considerable increase in our costs, especially in energy, food, labour and tax," said a Wetherspoon spokesperson.

"Although it is widely believed that current inflationary costs stem from external sources, a significant proportion of our cost increases (especially excise duty and labour cost increases) stem from government legislation. In spite of these increases, we remain confident of our future prospects, due to our resilient sales performance and strong free cashflow."