JD Wetherspoon has revealed its sales at the end of 2022 were far higher than the previous year, but still lagging behind pre-pandemic levels. The pub chain said like-for-like sales surged by nearly 18% over the last three months of 2022, compared with the same period in 2021, but remained 2% lower than the pre-pandemic period in 2019.
Costs in the hospitality sector were far higher than before Covid-19, Wetherspoon stressed, especially for labour, food, energy and maintenance, which has weighed heavily on pub and restaurant groups. The group’s chairman, Tim Martin, stressed he felt the biggest threat to the hospitality industry is pubs and restaurants being taxed more, while supermarkets pay no VAT on food sales.
Wetherspoon’s net debt was £745 million in late January, around £60 million lower than it reported in the same stage in early 2020. Wetherspoon’s chairman Tim Martin said: “We are cautiously optimistic about the company’s prospects for the financial year.
“The biggest threat to the hospitality industry is the vast disparity in tax treatment between pubs and restaurants and supermarkets. Supermarkets pay zero VAT in respect of food sales, whereas pubs and restaurants pay 20%. This tax benefit allows supermarkets to subsidise the selling price of beer.
“We estimate that supermarkets have taken about half of the pub industry’s beer volumes since Wetherspoon started trading in 1979, a process that has likely accelerated following the pandemic.”
