Record profits for Wetherspoon
JD Wetherspoon has reported record first half profits, successfully carried out a refinancing deal and reinstated a dividend.
The 746-strong managed pub chain reported profit before tax after exceptionals was up a massive 41.4% on last year to £36.2m. Profit was up 17.5% on a pre-exceptional basis.
Turnover for the 26 weeks to 24 January was up 4.1% to £488.1m including sales from 17 new pubs. Like-for-like sales increased marginally by 0.1% with total sales.
Wetherspoon plans to open 50 pubs this year. It will issue a dividend of 12p a share for the financial year ending 25 July.
"Sales and profits in the six months under review were at record levels, notwithstanding the immense pressure on the pub business from government legislation, thanks, above all, to the great efforts of all of our staff," said chairman Tim Martin.
"Trading in the six weeks to 7 March 2010 continues on a similar trend to last year, with like-for-like sales down 0.4% and total sales increasing by 3.9%.
"As a result of our sales, profits and free cash flow, together with our continued efforts to improve every area of the business, I remain confident of our future prospects."
The company has successfully concluded a new non-amortising £530m four-year facility, expiring in March 2014, with a syndicate of 11 banks, comprising a mix of current and new lenders.
This will replace the old facility of £435m which was due to expire in December 2010.
Breakfast plan
Wetherspoon said it will open all its pubs from 7am from 28 April to cash in on the strength of breakfast and coffee sales.
It now serves 275,000 breakfasts per week and about 500,000 coffees after opening all its pubs from 9am around five years ago.
"As a result of this success, we have decided to open all of our pubs for breakfast from 7am, from 28 April this year; this will, we believe, substantially enhance sales of these categories over time."
Wetherspoon awarded staff bonuses of £12.5m in the period — up from £9.8m on last year — with 93% of bonuses awarded to employees below board level. A total of 82% of bonuses were paid to staff working in pubs.
"The company believes that incentives for managers and staff, combined with excellent training schemes, are vital for future success," said Martin.
