Wetherspoon has warned that the coronavirus crisis will drag it to an annual loss after sales plunged following its reopening last month.
The pub chain told investors that like-for-like bar and food sales are down 16.9 per cent for the 44 days to August 16, compared to the same period last year.
The group said it now reopened 844 of its 873 pubs, after shutting all sites in March as a result of the virus.
Annual loss
Tim Martin, founder of Wetherspoon, said the sales slump means it expects to post a loss for the year to July 26.
“Sales have gradually improved, with a rapid acceleration recently, largely due to subsidised food, coffee and soft drinks in the early part of the week,” the company said in a statement.
It said sales have also been boosted by an increase in outdoor seating, while it has also benefited from “extremely flexible” landlords, local authorities and licensing authorities.
However, it stressed that its expects a “period of more subdued sales” once the Eat Out to Help Out scheme ends at the end of August.
“Subdued sales”
Mr Martin said: “Wetherspoon had five positive tests for Covid-19 among its 43,000 staff before lockdown and has had 24 positive tests since pubs reopened on July 4, since reopening, the amount of testing has substantially increased.
“Risk cannot be eliminated completely in pubs, but sensible social distancing and hygiene policies, combined with continued assistance and cooperation from the authorities, should minimise it”.
Russ Mould, investment director at AJ Bell, said: “It’s understandable that Wetherspoon is making a big song and dance about how it is following social distancing guidelines as it wants the public to feel that its pubs are safe to visit.
“Guidance that it will report a loss in its most recent financial year won’t be a surprise given the considerable disruption to trading.
“What really matters now is how the business fares without the sales incentive and if it can avoid pushing up prices to help claw back some of the lost revenue from earlier this year.”
Shares in the company moved 1.6 per cent higher 989.5p in early trading on Monday.
Related: Sunday Times criticised for race-baiting ‘non-story’ as Proms claims rile the right wing
Since you are here
Since you are here, we wanted to ask for your help.
Journalism in Britain is under threat. The government is becoming increasingly authoritarian and our media is run by a handful of billionaires, most of whom reside overseas and all of them have strong political allegiances and financial motivations.
Our mission is to hold the powerful to account. It is vital that free media is allowed to exist to expose hypocrisy, corruption, wrongdoing and abuse of power. But we can't do it without you.
If you can afford to contribute a small donation to the site it will help us to continue our work in the best interests of the public. We only ask you to donate what you can afford, with an option to cancel your subscription at any point.
To donate or subscribe to The London Economic, click here.
The TLE shop is also now open, with all profits going to supporting our work.
The shop can be found here.
You can also SUBSCRIBE TO OUR NEWSLETTER .
