British pub chain JD Wetherspoon announced a rise in first-quarter sales, supported by competitive pricing and consistent demand for its affordable products amid the cost of living challenges.
J D Wetherspoon shares were up by 0.8% at the time of writing.
The hospitality industry in the UK has benefited from robust customer spending, aiding its recovery from pandemic-related lows.
The group reported a 9.5% increase in like-for-like sales for the 14 weeks ending November 5, with total sales up 8.1% year-to-date.
The company, with 816 pubs in the UK and Ireland, plans to invest approximately £70 million this year to enhance its pubs.
The UK-wide-wide of living crisis remains a push factor affecting lower customer spending at pubs.
“It’s hard to tell whether punters at J. D. Wetherspoon are celebrating or drowning in their sorrows. But either way, they’re spending more on like-for-like sales in the first 14 weeks of the financial year, up 9.5%. This is all the more impressive given that the pub chain reported similar growth in the same period last year. Founder Tim Martin noted easing inflationary pressure but cautioned that suppliers (such as brewers) were still under pressure from elevated energy prices,” said Hargreaves Lansdown’s Derren Nathan.
“The company has been trimming the estate, with a further net reduction of nine pubs in the period. The balance sheet strengthened materially last year, and that’s facilitating a material uplift in investment in Spoon’s remaining sites, with Capex guided to increase from £46.9 million to £70 million,” Derren further added.