TIDMJDW
RNS Number : 0036E
Wetherspoon (JD) PLC
13 July 2016
13 July 2016
J D WETHERSPOON PLC
PRE-CLOSE TRADING STATEMENT
J D Wetherspoon plc presents below its pre-close trading
statement for the financial year to 24 July 2016. The preliminary
results are due to be announced on 09 September 2016.
Current trading
For the 11 weeks to 10 July 2016 like-for-like sales increased
by 4.0% and total sales increased by 3.8%. In the year to date (50
weeks to 10 July 2015) like-for-like sales increased by 3.4% and
total sales increased by 5.5%.
The full-year operating margin before exceptional items and
before a GBP3.8m gain on property is expected to be around 6.8%,
compared to 7.4% last year.
Property
The Company has opened 13 new pubs since the start of the
financial year, has sold 29 and has closed 11. We expect to open 16
new pubs in this financial year. There will be around GBP13m of
exceptional, non-cash losses in this financial year, which are
mainly associated with pub disposals and closures.
Financial position
The Company remains in a sound financial position. Net debt at
the end of this financial year is currently expected to be around
GBP670m.
The company has bought back 5.7m shares, at a total cost of
GBP39m, since the start of the financial year.
Outlook
The chairman of Wetherspoon, Tim Martin, said:
"As most people will be aware, an unusual number of forecasts
for the UK economy have been made in the run-up to, and the
aftermath of, the referendum. Most of the forecasts from
representatives of institutions which are normally responsible for
financial stability were extremely negative.
"For example, the International Monetary Fund`s Christine
Lagarde said in May that a leave vote in the referendum would be
"pretty bad to very, very bad."
"An IMF report additionally said that a leave vote would have a
"negative and substantial effect".
"Similar comments were made by the Bank of England Governor Mark
Carney. H.M. Treasury also warned that Brexit would cost the
average household about GBP4,000 per annum in the future. The CBI,
Goldman Sachs, Morgan Stanley, PWC and many FTSE 100 CEOs, among
others, supported this negative view.
"The Chancellor of the Exchequer George Osborne repeatedly
warned that mortgage and interest rates were likely to rise in the
event of a leave vote and threatened an emergency budget to
increase taxes and to reduce public expenditure.
"Osborne`s stance was supported by Prime Minister David Cameron,
who also forecast an increased likelihood of war and genocide.
"Unbeknown to most voters, one of the "architects" of the Remain
campaign, which devised the above approach, was Peter Mandelson
("How the struggle for Europe was lost", Peter Mandelson, Financial
Times, 2 July), who worked closely with Cameron, Osborne and
others.
"In my opinion, the above individuals and organisations are
either dishonest, or they have a poor understanding of economics,
since democracy and prosperity are closely linked and the EU is
clearly undemocratic. By voting to restore democracy in the UK, I
believe the UK's economic prospects will improve, although it is
quite possible that the unprecedented and irresponsible
doom-mongering, outlined above, may lead to some kind of
slowdown.
"In spite of the dire warnings above, Wetherspoon trade
strengthened slightly in recent weeks and we consequently
anticipate a modestly improved outcome for this financial year.
Caution should be exercised in extrapolating current levels of
sales growth for future years."
Enquiries:
John Hutson Chief Executive Officer 01923 477777
Ben Whitley Finance Director 01923 477777
Eddie Gershon Company spokesman 07956 392234
Notes to editors
1. J D Wetherspoon owns and operates pubs throughout the UK. The
Company aims to provide customers with good-quality food and drink,
served by well-trained and friendly staff, at reasonable prices.
The pubs are individually designed, and the Company aims to
maintain them in excellent condition.
2. Visit our website: www.jdwetherspoon.co.uk
3. This announcement has been prepared solely to provide
additional information to the shareholders of J D Wetherspoon, to
meet the requirements of the FCA's Disclosure and Transparency
Rules. It should not be relied on by any other party, for any other
purposes. Forward-looking statements have been made by the
directors in good faith, using information available up until the
date on which they approved this statement. Forward-looking
statements should be regarded with caution, because of the inherent
uncertainties in economic trends and business risks.
4. This announcement contains inside information on JD Wetherspoon plc.
5. The current financial year comprises 52 trading weeks to 24 July 2016.
6. The next trading update is expected to be the Company's final
results announcement on 09 September 2016.
7. The article below was written by Tim Martin on the 27 June
2016. It outlines his views on the advantages of Brexit, the best
approach to negotiating with the EU and a sensible approach to
immigration.
The New Magna Carta
"The western world is aghast that a majority of Russian people
seems to approve of Mr Putin's authoritarian rule, shackling of the
press and intimidation of opponents. Yet most are oblivious to a
subtler reduction in democracy in the EU in recent years: laws
instigated by unelected commissioners; a European Court whose
judgements override national parliaments; MEPs with limited powers;
unaudited accounts for two decades and a ruling class of five
unelected presidents. Both eastern and western regimes brought
economic hardship to their peoples, with 50% youth unemployment in
Greece and Portugal being one example in the west. The cataclysmic
referendum result on Thursday has shaken the world. Democracy is
back, but like prisoners confronted with freedom for the first time
in decades, the nation is frightened and awestruck by its unlimited
options.
The legacy of Project Fear is that the majority seems to believe
that economic prospects are now worse, but unless history is turned
upside down, the reverse is true. Democracy has always proved to be
economic steroids. It took Japan and South Korea no time to emerge
from the backwaters once democracy took root. The United States
economy, with democracy enshrined in its constitution, became the
most successful in the world from nowhere, once it shook off the
colonial yoke- no taxation without representation was the mantra.
Compare unfortunate South America. With similar population,
resources and climate, but without the democratic heritage, the
continent floundered badly and is still struggling mightily to
shake off its autocratic chains. Examples of the economic success
of democracy abound from New Zealand and Australia to Canada,
Singapore and Norway.
Warren Buffett, the world`s greatest investor, has said that he
cannot forecast where the stock market is going and he doesn't
think anyone else can either. This modesty is not reflected in the
central bankers and other soothsayers who, before the referendum,
forecast trouble for the UK economy in the event of Brexit. The
IMF, the OECD, the Bank of England, the CBI, Goldman Sachs, FTSE
chief executives and others lined up to prophesy economic trouble
ahead. Blinded by spreadsheets and ego, these Mystic Megs can't see
the wood for the trees. The 'wood' in this case being the above
examples of countries which have thrived as democracy has increased
- most, but not all, economists, from David Smith at the Sunday
Times to Martin Wolf at the FT and Mark Carney at the Bank of
England, just don't get this point.
So now that the British have set themselves free, what do we do?
The key, as in any successful negotiations, is to avoid being
hectored or rushed. The timescale set by David Cameron seems
sensible- the referendum was not a manifesto, so we need until the
autumn to hammer out a plan. For most businesses free trade is a
good starting point. It was helpful of our German friends, at their
equivalent of the CBI, to point out the economic folly of
attempting to impose tariffs on the EU`s biggest customer- the UK.
If both sides impose the same tariffs, the UK public finances will
gain hugely, since we run a massive deficit with the EU, but free
trade will benefit both our citizens and the EU's. We can be sure
that French, Italian and other producers of goods we import will
take a similar view to the Germans, and that this free-trade
philosophy will prevail, whatever the unelected President Juncker
may think. Confounding received opinion, it's the Brussels
bureaucracy which is threatened by Brexit, not The UK, hence the
hollers from Juncker and co.
On the world stage the EU acts as a 'customs union' which
imposes tariffs on food, wine and manufactured goods from most
non-EU countries. Wetherspoon, for example, the UK`s biggest seller
of wine in pubs, pays tariffs on most of the 95% of our wine we
import from outside the EU. Eliminating tariffs on non-EU imports
will be a huge shot in the arm for UK consumers, reducing shop
prices and improving living standards, while acting as a catalyst
for trade with the world.
Contrary to perceptions, most, but not all, Brexiteers also
believe that immigration is a common factor in almost all
successful democratic economies. The United States, Australia, New
Zealand and Singapore, for example, have had consistently rising
populations over many decades and that has gone hand in hand with
superior economic performance. The leaders of the Leave campaign
generally recognise this point, but believe that the essential
factor is to have control over the process through an
Australian-style points system, which welcomes immigrants provided
they have the qualifications the country needs.
The EU system, whereby entire countries become entitled to live
anywhere in the EU, once they have passed the various 'tests', will
no longer apply in the UK, unless parliament decides otherwise. All
parties in this debate agree that current UK residents from EU
countries, who have generally made such a valuable contribution to
the economy, will be allowed to stay here as a matter of
international law. My own strong view is that current inhabitants
of EU countries, who are now entitled to work and reside in the UK,
should also be allowed to do so in future. This approach, similar
to our historic and excellent relationship with Ireland, recognises
the importance of immigration to the economic success of the UK,
but means that control of the future rests with a democratically
elected parliament, not with the Byzantine scheming of EU
bureaucrats.
A drawback of these proposals is that high levels of immigration
have put an undoubted strain on some public services. A sensible
solution would be to divert the funds saved from EU membership,
about GBP9bn per annum, to those communities, especially
less-affluent ones, that have felt the most pressure.
Democracy , prosperity and freedom are inextricably linked. The
EU is heading down an increasingly autocratic path, which has
already caused severe economic problems in most of southern Europe,
and risks further contagion on the continent. Brexit is a modern
Magna Carta, reasserting democratic control in the UK. It is up to
UK citizens now to participate in formulating policies based on
free trade with Europe and the world, an enterprise economy and
sensible immigration policies, with parliamentary control. As one
US president said, we have nothing to fear but fear itself. But Big
Brother in Brussels is no longer in charge. The world is our
oyster, provided we think clearly, debate strongly and prevent the
paranoia and hyperbole of the referendum process from clouding our
judgement."
This information is provided by RNS
The company news service from the London Stock Exchange
END
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