(Reuters) -British pub group J D Wetherspoon posted higher first-quarter like-for-like (LFL) sales on Wednesday but said the recent UK budget would increase its taxes and business costs by 60 million pounds ($77.12 million) over the whole of next year.
“The company is confident of a reasonable outcome for the year, although forecasting is more difficult given the extent of the increased costs,” said Chairman Tim Martin.
Pub groups were hit hard earlier this year by a cost-of-living crisis but were recovering in the second half due to numerous sporting events in the period.
However, they are again facing cost pressures and wage inflation after British finance minister Rachel Reeves announced the biggest tax increases in three decades on Oct. 30.
All hospitality businesses plan to increase prices, Martin said, adding that Wetherspoon will also stay competitive. However, he did not disclose whether the company will raise prices and if so, by how much.
The pub group said LFL sales in the first 14 weeks of the financial year were 5.9% higher than the same period last year, driven by demand for its drinks and pub grub.
J D Wetherspoon’s shares rose 1.3% to 606 pence in early trade. The stock, part of the blue-chip FTSE 100 index, has fallen about 25% this year. ($1 = 0.7780 pounds)
(Reporting by Yamini Kalia in Bengaluru; Editing by Sonia Cheema and Savio D’Souza)
