When JD Wetherspoon PLC (LSE:JDW) provides a pre-close trading update on Wednesday 12 July investors will be keen to find out whether any of the soaring costs stunting the industry are abating.
Food and drink prices have remained stubbornly high since the cost-of-living crisis struck more than a year ago, though this has boosted like-for-like sales for Spoons' and its rivals.
Prices for hospitality operators lifted by 21.6% year-on-year in May, according to the CGA’s food service price index.
High energy bills and an increase in the national minimum living wage could also play a role in dampening operations.
Against this backdrop, the pub operator appears confident in reaching record sales for the year, with LFL sales up 9.1% in the third quarter, up 6.4% for the year to date.
When reporting third-quarter results the company also said a swarm of returning punters post-covid helped boost revenues and it expected profits to be towards the top of the end of market expectations.
Additionally, it will not be a surprise if outspoken boss Tim Martin makes some comments on the wider industry, recently returning to one of his favourite subjects: taxation on alcohol.
In an interview with LBC, he said the fact some brewers had started weakening beer to achieve a tax break was a “crazy move”.
Noting that Martin aspires to getting the company back to £100m profit before tax in order to resume paying dividends, broker Peel Hunt said: "We currently forecast such an outcome, worthy of a £10 -12 share price, occurring in 2027. Given that there is upgrade momentum, this outcome could happen sooner."
Wetherspoon shares have bubbled up more than 40% in 2023 to around 650p.