Wetherspoon sales decline continues

JD Wetherspoon has reported a further slide in sales across the past three months.

The high street pub group is also stepping up the roll-out of its non-smoking pubs, planning to more than double the number to more than 60 over the next few months.

The company said the immediate loss of bar trade in pubs where smoking has been banned is being balanced by a gradual increase in food sales, but finance director Jim Clarke stressed it is "too early" to draw any definite conclusions on how the pattern of trade will change.

Over the 13 weeks to April 24, like-for-likes fell by 2 per cent, a faster rate of decline than the 0.5 per cent fall seen over the first nine months of the year as whole.

Total sales are up by 2 per cent to £202.9m across the quarter, and by 3 per cent to £606.3m across the year.

Mr Clarke said that in common with many other operators, liquor sales were down. There are few customers out, particularly on Friday and Saturday night, and many are going out later and so spending less.

"That's not as big a problem for us as it is for some other operators, because we trade well through the week and have higher food sales," said Mr Clarke. "But they are still big nights for us." Operating margin for the quarter fell by around 1 per cent, with a hit on margins in its non-smoking pubs in particular.

Eleven pubs have been converted and six new pubs opened as non-smokers. Mr Clarke said that the initial dip in bar sales "as smokers desert you on day one," followed by an increase in food sales, puts some pressure on margins.

As well as new customers encouraged to eat out by the smoke-free atmosphere, Mr Clarke said that the company is also seeing some smokers come back after a while, "thanks to pub gardens", but stressed "it is way too early" to say how the pattern of trade will settle down.

The company, which two years ago was expanding at the rate of one pub a week, will open 13 across the full year, and has reached agreement in principle on the sale of 16.