By Raechel Thankam Job
(Reuters) -British pub group J D Wetherspoon’s third-quarter sales rose, it said on Wednesday, but it gave no full-year guidance as mounting costs and a challenging economy complicated forecasting and raised questions about its pricing strategy.
While inflation and the economic uncertainty caused by trade tensions have increased the risks to consumer spending and raised the prospect of price hikes across the pub industry, Wetherspoon’s low-cost model has continued to attract costumers looking for a cheaper deal.
“We don’t like to talk about price – other than our intention to remain competitive. Nor are we slowing down hiring,” Chairman Tim Martin told Reuters.
The company’s like-for-like sales in the three months to April 27 rose by 5.6%.
Shares in the pub group, known colloquially as Spoons, have rallied in the last few weeks and hit their highest level since October 2024 on Wednesday. They were last up 0.8%.
“We cannot foresee anything but price increases across the industry in order to protect profitability, so whilst some share is likely to be lost to eating/drinking at home, JDW should continue to take share out of home,” Barclays analyst Richard Taylor said in a note.
Analysts were divided over whether JD Wetherspoon would raise prices to offset the wage impact of higher UK employment taxes that took effect last month.
Wetherspoon expects to add 1.2 million pounds ($1.60 million) per week to its operating costs.
Panmure Liberum analysts said the company had limited scope to pass costs onto customers and retained its concerns over long-term margin recovery potential.
Analysts at Jefferies, meanwhile, said the company’s low price position versus peers made it better placed to absorb wage inflation through prices.
Wetherspoon has been upgrading its pub network and expanding into high-traffic locations. It expects to open a further four or five pubs in this fiscal year.
($1 = 0.7490 pounds)
(Reporting by Raechel Thankam Job and Yadarisa Shabong in Bengaluru; Editing by Sumana Nandy and Barbara Lewis)
