British pub group JD Wetherspoon JDW.L expects sales to recover to pre-pandemic levels this year, provided pandemic restrictions are not re-imposed, and is working with suppliers to curb the impact of inflation, chairman Tim Martin has said.
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Wetherspoon is facing higher costs of food, drink and energy, but expects the rise in input prices to be slightly lesser than the level of inflation, the British pub operator said after reporting a first half loss.
Even as the highly infectious Omicron variant of the coronavirus has swept Britain, Wetherspoons over in the three weeks to 13 March saw sales only 2.6% below the same period in 2019 before COVID-19 took hold.
But the loss-making group, which runs more than 800 pubs in the United Kingdom and Ireland, faces the challenge of rising costs as the British economy deals with inflation at 30-year highs.
Martin, via text messages with Reuters, said the company will work with suppliers to provide offers for customers that will be competitive "in spite of pricing pressures".
While Britain's hospitality sector has begun to recover from the severe impact of COVID, analysts say the uncertainty surrounding the war in Ukraine is a new blow to consumer confidence.
"Despite high hopes that punters would once again be elbowing each other to get to the bar, the glass is very much half empty for the company, with pre-COVID levels of profits remaining elusive," Hargreaves Lansdown analyst Susannah Streeter said.
Wetherspoon, called simply Spoons by many younger customers, reported a loss of £21.3 million in the six months to 23 January, compared with a profit of £57.9 million a year earlier.
"Draconian restrictions, which amount to a lockdown-by-stealth, are, of course, kryptonite for hospitality, travel, leisure and many other businesses," Martin, who has been an outspoken critic of the British government's handling of the health crisis, said in the first-half results statement.
Russia's Invasion Of Ukraine
Martin said that Wetherspoon stopped selling Baltika beer from Russia after the country's invasion of Ukraine.
Danish brewer Carlsberg CARLb.CO, which owns Baltika, Russia's largest beer brand, last week began a strategic review of its business in the country.
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