JD Wetherspoon PLC (LSE:JDW) said trading in the first 14 weeks of its new financial year was back above pre-pandemic levels but it warned that costs were "substantially higher" than they have been historically.
The update also revealed the pub group has refinanced some £400mln of its £745mln of debt, which would lead to a £10mln increase in interest costs.
In the current environment of rising borrowing costs, the 4.67% it will pay per annum over the next three years suggests lenders still have faith in the business model.
It also said it would receive £169.4mln after terminating an interest rate swap deal.
In the statement, investors were told that a further seven of its pubs would be put up for sale, taking the number to 39.
Wetherspoons is streamlining the business in the face of rising labour, food and repair costs.
The chain, which stopped leaking cash last financial year, said it expects to remain cash flow positive.
For the 14 weeks ended 6 November 2022, underlying sales were up 9.6% compared with the same period last year, and were 0.4% above the corresponding timeframe in 2019.
"Sales have improved since the ending of restrictions in the early part of this calendar year and are considerably above the same period in the last financial year,” said chairman and founder Tim Martin.
"The company reported a return to positive cash flow in full-year 22 and anticipates a positive cash flow in the current year.
"In my comments on the full-year results released on 7 October 2022, I set out various threats to the hospitality industry and these continue to apply.
“Those caveats aside, in the absence of further lockdowns or restrictions, the company remains cautiously optimistic about future prospects."