Wetherspoon warns over rising costs

The firm said like-for-like sales rose 2.3 per cent in its half year to January 23, with growth accelerating to 2.8 per cent in the following six weeks.

Pre-tax profits fell 11 per cent to £32.2m as an overall 7.6 per cent rise in revenues was offset by higher costs and interest charges after a debt refinancing last March.

It warned that prices in its pubs and those across the industry would need to rise by around four per cent to combat inflation, adding to the squeeze on customer pockets.

Wetherspoon is being buffeted by increased taxes, labour costs and rising prices relating to utility bills, bar and food supplies.

However, the group said operating profits and sales hit record levels in the half year.

It rewarded staff by sharing out £12.3m in cash and shares bonuses, of which 87 per cent were paid to workers in its pubs.

The handout is paid monthly and is around nine per cent of salary on average, it added.

Tim Martin, chairman of Wetherspoon, said: “In common with most businesses in Britain, the company is faced with rising costs for a wide range of goods and services, combined with a reduction in disposable income for many customers. In addition, pubs are dealing with a pernicious combination of increasing taxes and regulations.”

He added the group was still hoping for a “reasonable outcome” for the full-year.