Wetherspoons reported an 11 per cent decline in adjusted pre-tax profits to £55m in the year to July 27, adding to the gloom in the sector following downbeat updates from Punch Taverns and Greene King earlier this week.

The group, which has nearly 700 pubs in Britain, has been hit hard by last year's smoking ban, rising costs, and declining consumer spending, while cheap alcohol offers in supermarkets and the miserable summer weather have encouraged drinkers to stay at home.

The group said that despite the downturn its Yorkshire pubs have seen strong growth, prompting the company to open its 700th pub in Barnsley later this month.

Wetherspoon's finance director Keith Down said the Yorkshire region has played an important part in the company's growth.

"As a general rule we have seen stronger food sales in Yorkshire. The smoking ban has hit drink sales, but it has encouraged people to eat more in our pubs."

Following the opening of the group's 700th pub later this month, Wetherspoons also has plans to open pubs in Mexborough and Thirsk later this year.

It is also planning new pub sites in Sheffield, Doncaster, Pontefract, Otley, Wakefield, York, Heckmondwike, Selby, Todmorden, Scarborough, Hull and Leeds.

"We are looking for a number of new sites in the region. Yorkshire is a strong trading area for us," said Mr Down.

Nearly a third of the group's revenues now comes from food, with a further third coming from drinks ordered alongside food.

Food sales now account for 29 per cent of the group's business, compared with 17 per cent a decade ago and just 5 per cent at the time of the company's flotation in 1992.

Total sales increased by 2.1 per cent to £907.5m during the year. Like-for-like food sales rose by 7.9 per cent, but comparable bar sales were down 4.3 per cent, resulting in an overall like-for-like sales decline of 1.1 per cent.

Chairman and founder Tim Martin said that the company is expecting a considerable increase in energy, food, labour, and tax costs this year.

Mr Martin is calling for beer duty to be held at current levels for the next five years to encourage drinkers to return to Britain's hard-pressed pubs.

"We've already got the highest excise duty in Europe for beer. I want a moratorium for five years.

"No more tax increases until we're on a par with other countries," he said.

Mr Martin estimates that the increase in excise duty on alcoholic drinks plus minimum wage related costs and increased statutory holiday entitlements will cost Wetherspoon an extra £16m.

He said the company will need to achieve a like-for-like sales increase of about 3 per cent this year to offset these increases.

In the five weeks to August 31, like-for-like sales increased by 1.1 per cent, and Mr Martin said like-for-like growth may be more achievable now the anniversary of the smoking ban on July 1 has passed.

"It's easier but not guaranteed," he said.

"Non-smoking has been quite traumatic for the pub industry. As that effect wears off, people who were used to having a fag in association with a pint will slowly adapt and start coming back to pubs."

Wetherspoons is paying a final dividend of 7.6p per share, making an unchanged total dividend of 12p per share.

Coming to a town near you

New pub sites for Wetherspoons (in Yorkshire):

Barnsley – September 2008

Mexborough – November 2008

Thirsk – December 2008

Other planned sites are:

Sheffield, Doncaster, Pontefract (opening dates to be confirmed).

Wetherspoons has also identified sites in:

Otley, Wakefield, York, Heckmondwike, Selby, Todmorden, Scarborough, Hull and Leeds.