JD Wetherspoon's has announced it will not convert anymore existing pubs to non-smoking but all new premises will be smoke free.
Speaking as the company announced its interim results for the six months to January 22nd, chairman Tim Martin said there had been a 7.6% dip in like-for-like sales at JDW's non-smoking venues - however overall turnover was up 1% to £406.3m.
This combined with the impending smoke ban had led to the end of the smoke-free roll out.
Martin said: "We announced in March 2005 plans to convert approximately 10% of our pubs to non-smoking, followed by the rest of the estate in May 2006.Given the government's decision to bring forward a complete national smoking ban by 18 months to the middle of 2007, and our initial financial performance, we have decided to await the complete ban imposed by the government in 2007.In the meantime, new pub openings will continue to be non-smoking and we will complete the small number of conversions already in the pipeline. In addition, the ban on smoking in Scotland, due to take place on the 26th of this month, will result in a further 36 pubs becoming non-smoking.It is clear from our experience and from the evidence of other areas, such as Ireland, California and New York, that the initial effect of a smoking ban can result in sales and margin declines.
However, we believe that sales and margins can recover over time, once customers adjust to the non-smoking environment."
Despite the dip at non-smoking venues there was plenty of good news for JDW.
Turnover went up 1% to £406.3mOperating profit went up 15% to £39.7mProfit before tax went up 21% to £27.4mEarnings per share were up 31% to 10.6p
Martin said: "The half year to 22 January 2006 was a period of good progress for the Company.
In the light of our strong earnings and cash flow, combined with our continued concentration on making many small improvements to the business, I remain confident of the Company's longer-term future prospects.
For a full company report see J D Whetherspoon's website.
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