Wetherspoons set to shine light on extent to which cost of living crisis is eating into pub sector’s post-Covid bounceback
Wetherspoons will next week shine a light on the extent to which the cost of living crisis is eating into the pub sector’s post-Covid bounceback.
Industry figures show a trip to the pub is one of the last things consumers cut. And in March Wetherspoons said business was good.
But analysts are watching for its fourth-quarter trading update on Wednesday to see if the growing pressure on budgets will have shifted the dial.
Tim Martin, who set up the chain in 1979 and is its chairman, may also have advice for Chancellor Nadhim Zahawi.
He has called for the Government to rebalance taxes between the hospitality industry and supermarkets, including by lowering VAT on food. And he has accused the Bank of England of stoking inflation by pumping money into the economy through the pandemic.
Wetherspoons, which has 861 UK pubs, has pushed up prices to combat the rising cost of staff, food and energy. And the City will be looking for any update on how cost rises are being managed.
Hargreaves Lansdown equity analyst Matt Britzman said: ‘The main story will likely focus on inflation. In March, cautious consumers hadn’t impacted trading. Given the cost of living crisis has evolved since, it’ll be interesting to hear whether that trend has shifted.’
Analysts expect a £15.3m profit for the full year to July, compared with last year’s £167m loss. Britzman said for it to break even the chain must hold its sales growth momentum through the quarter.