Wetherspoon on brink of hitting £1bn milestone

Published on Wednesday 1 September 2010 17:52

FAST-growing pub chain JD Wetherspoon is poised to burst through £1 billion in sales this week when the group will also confirm it is looking to take the brand to the Orkneys.

The group, which has more than 40 pubs in Scotland including The Alexander Graham Bell in Edinburgh and The Counting House in Dundee, will also reveal plans to open outlets in Livingston and Hawick by the end of this year.

Company spokesman Eddie Gershon said the two new outlets would create 80 jobs, as he also confirmed Wetherspoon had identified a site in what would be its first foray into the Orkneys - if it gets planning permission.

Gershon said: "We have identified a site in the Orkney Islands and would love to open a pub there. We believe that our style of pub will appeal to the people living there as well as holidaymakers.

"Wetherspoon's first pubs in Scotland were located in major cities like Glasgow, Edinburgh, Aberdeen and Dundee. However, we are keen to open throughout the country and the Orkney Islands is definitely an area we are keen on."

Meanwhile, City analysts say Wetherspoon, which has nearly 800 pubs UK-wide, could reveal it has cracked the 1bn sales barrier after hitting 955.1 million last year.

James Dawson, drinks specialist at broker Charles Stanley, said: "Some believe Wetherspoon will go through the billion pounds of sales, or possibly just a shade under. It will be very close."

Sales and profits are expected to have grown despite the group, where founder-chairman Tim Martin has a 24 per cent stake, saying it was cautious about prospects earlier this year because of "the risk of more subdued customer expenditure".

Turnover has benefited, say analysts, from the company's decision last spring to bring forward its opening times for breakfast traffic to 7am after five years of opening at 9am. Martin said at the time that many of the towns and suburbs Wetherspoon operated in did not have coffee chains open as early as 7am. In July the company said Q4 total sales had jumped nearly 6 per cent.

The City expects underlying pre-tax profits at Wetherspoon to have risen to between 69 million and 73m compared with 66.2m last time.

The group paid an interim dividend of 12p plus a special divi at the time of 7p, with most analysts saying they expect either no final dividend, or a minimal new payout, as a result.

One analyst said: "Wetherspoon's expansion plans appear on track. One other issue for them is the continuing balancing act between being competitive on price to retain their traditional drinks customer-base, but not going so far on price that it drives out the more food-oriented female customer the company has encouraged in recent years."