Demand for cheap pints gathered momentum over the festive period with Wetherspoon’s bars enjoying increased like-for-like sales ahead of industry benchmarks.
In the 25 weeks to 21st January 2024, like-for-like sales rose 10.1% versus the same period last year. Bar sales were up 11.8%, with food up 7.9%. Total sales grew 8.4% year-to-date.
Recent trading showed no let-up, with like-for-like sales jumping 11.1% in the last 12 weeks. Wetherspoon continued to outperform the broader pub and restaurant sector, with its December like-for-like growth of 15.2% well ahead of the industry average of 8.8%. This marks 16 straight months of outperformance for Wetherspoon.
The company did see some moderation in the last 3 weeks, with like-for-like sales up 5.8%, but the underlying momentum remains strongly positive heading into the key spring and summer trading periods.
“It’s fair to say that even a cost of living crisis has not dulled the British appetite for a pint at the pub, especially when the pints are going cheap. Wetherspoons’ jump in sales versus last year illustrates that small luxuries will still be afforded within people’s budgets, even when money is tighter than usual,” said Adam Vettese, analyst at eToro.
“The pub group has always been centred on value and this is in focus more than ever, albeit with inflation weighing on input costs in recent times. This value focus will have helped the business to carefully balance costs over the last year and with pressures likely to ease up in the months ahead and with rate cuts coming in, Wetherspoons is very well placed to kick on.”
After a rip-roaring rally in JD Wetherspoons shares from the October in which the stock has gained by third, today’s trading update was the signal for some investors to book profits.
JD Wetherspoons shares were down by 1.5% at the time of writing.
“With the shares up some 75% over the last year and a valuation multiple of about 20x forward earnings, there’s certainly pressure to keep serving up impressive results,” said Derren Nathan, head of equity research at Hargreaves Lansdown.
