JD Wetherspoon PLC (LSE:JDW) appeared to lay out strong interim results on Thursday, as the pub chain reported an eightfold increase in pre-tax profit to £36 million.
However, shares in the chain slipped 6% during the day as investors seemingly viewed still-slim margins and slowing sales growth negatively.
Margins did climb from 4.1% to 6.8% over the half year to January, but at below 7%, Hargreaves Lansdown’s Derren Nathan said the figure was “still pretty thin”.
Alongside this, “there was little in the statement to help see where an improvement might come from”, he added.
Given the number of Wetherspoon pubs has fallen in recent years, Nathan also pointed out that “there’s only so much you can grow if pub numbers remain static”.
“For now, like-for-like growth has taken a step down. 5.8% isn’t awful, but if it stays at this level for the rest of the year the market’s likely to be disappointed,” he said.
Shares fell to 6% to 747.50p.