Pub chain JD Wetherspoon is predicting losses of around £30m amid a slow recovery from the after-effects of the Covid pandemic.
The group, whose chairman Tim Martin suggested staff should “go and work in Tesco” during the pandemic, said a hike in wages and surging repair costs for many of its venues meant it would struggle to drive down declining profits in the year to the end of May.
Sales of draught ales, lagers and ciders, previously the biggest driver of pub trade, were 8% below 2019 levels, it revealed.
Wetherspoon – which operates 60 venues in Scotland – had previously said in May that it expected to break even over the full year, having cheered a return to profit in March.
The company has reported losses in each of the last three years, including a pre-tax reduction of £154.7m before tax in 2021 – only its second non-profitable year since 1984.
It comes as the group said the recovery for many pub firms had been “slower and more laborious” than expected, while the sector is also grappling with soaring costs and a pull-back in consumer spending due to rising inflation.
Repair costs have also soared, with the group saying it will have spent about £99m on this in the current year, compared with £76.9m in 2018-19, due to “catch-up” work since Covid restrictions lifted.
Chairman Martin said: “Wetherspoon has tried to take a long-term approach to these issues, investing heavily in the workforce, in buildings, in marketing and in contracts with landlords and suppliers, which will hopefully create a solid base for future growth. The company remains cautiously optimistic about future prospects.”