Wetherspoon’s (JDW) chairman and staunch Brexit supporter Tim Martin hasn’t missed an opportunity to criticise David Cameron as he steps down as Prime Minister.
Revealing a modest improvement in trading across the pub chain since the Brexit vote, Martin claims Cameron, Chancellor George Osborne and one of the Remain campaign ‘architects’ Peter Mandelson are ‘either dishonest, or they have a poor understanding of economics, since democracy and prosperity are closely linked and the EU is clearly undemocratic’.
Martin believes the UK’s economic prospects will improve, although he says the ‘unprecedented and irresponsible doom-mongering… may lead to some kind of slowdown’.
He anticipates a modest improvement in Wetherspoon’s results this financial year but warns that investors shouldn’t extrapolate current levels of sales growth for future years.
Like for like sales in the 11 weeks to 10 July increased by 4%. In the 50 weeks to 10 July 2015, like for like sales increased by 3.4%. The company anticipates full year operating profit to be in the region of 6.8% versus 7.4% last year. This excludes the £3.8 million gain from property sales.
The company has opened 13 new pubs since the start of the financial year, has sold 29 sites and has closed 11 pubs. ‘We expect to open 16 new pubs in this financial year. There will be around £13 million of exceptional, non-cash losses in this financial year, which are mainly associated with pub disposals and closures,’ it adds.
Prior to the trading update, shares in Wetherspoon had fallen by 2% since the Brexit vote was announced. They are down 0.8% year to date.
‘The operator remains best-in-class at what it does but, if the UK does go into (or has already gone into) a recession, then trading could suffer,’ says leisure analyst Mark Brumby at Langton Capital.