Three years since the world was put into lockdown and Covid caused significant economic and societal disruption, Wetherspoons is still dreaming of a profitable recovery.
Pre-tax profit for the year to 29 January 2023 was down more than 90% on 2019 levels as inflation took the biggest bite imaginable.
AJ Bell’s Russ Mould said: “Wetherspoons has always been a low margin business, preferring to give customers good value for money and keep things as cheap as possible. Its model is based on achieving high sales volumes so when costs shoot up, there is often only pennies left on the table once accounting for its outgoings.
“If you go into its city centre pubs today, most will be busy with people having a good time. Sadly, Wetherspoons is only making a fraction of what it was pre-Covid.
“So where does it go from here? It’s a case of waiting for some of the headwinds to subside. Its prices are low enough to be able to push through some further increases if it needs to, and the company continues to put pockets of pubs up for sale to streamline the estate and bring in some extra cash. Despite the pressure on earnings, it continues to invest in its estate and snap up the odd freehold when opportunities arise.
“Wetherspoons has been through plenty of ups and downs during its existence and always seems to be able to survive intact. Founder Tim Martin certainly isn’t afraid of having a grumble, but the company knows what the customer wants and is able to deliver time and time again.”