JD Wetherspoon (LSE:JDW) PLC said it is "cautiously optimistic" about the current year as sales begin to recover following the easing of Coronavirus (COVID-19) restrictions. However labour shortages are making it difficult to find staff in some parts of the UK, particularly in the “staycation” areas in the West Country, the pub chain added.
Wetherspoon's earnings statement for the year to 25 July 2021, when pubs were closed nationally for 19 weeks due to pandemic restrictions, revealed underlying pre-tax losses of £154.7mln versus losses of £34.1mln the prior year.
Revenues were £772.6mln, below consensus forecasts of £799mln and down 38.8% on the previous year. Like-for-like sales decreased by 38.4%.
Sales have improved in the last few weeks, with like-for-like sales in the first nine weeks of the current year 8.7% lower than the same weeks in August and September 2019, before the pandemic started. This improved in the last four weeks, when the decline in like-for-like sales shrank to 6.4% compared with pre-COVID 2019, Wetherspoon said.
But airport pubs are still suffering from travel restrictions, with like-for-like sales down 47.3% in the first nine weeks. Excluding airport pubs, like-for-like sales declined 7.1% in the first nine weeks and 4.9% in the last four compared with 2019.
Wetherspoon chairman Tim Martin said the “often conflicting and arbitrary rules” relating to pub openings and closures during the pandemic had put pressure on the hospitality sector.
"Pubs have been at the forefront of business closures during the pandemic, at great cost to the industry - but at even greater cost to the Treasury,” Martin said.
"In spite of these obstacles, Wetherspoon is cautiously optimistic about the outcome for the financial year, on the basis that there is no further resort to lockdowns or onerous restrictions.”
Free cash outflow increased by £1.6mln to £60.5mln during the year.
As at 25 July 2021, the company's total net debt, excluding derivatives, was £845.5mln, up from £817mln a year earlier.
Wetherspoon is not paying a dividend.
Shares were down 5.32% at 987.50p in early deals.