Wetherspoon's plans new pubs despite slump

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The Independent Online

JD Wetherspoon vowed to press on with its pubs opening programme in a soft property market, despite posting a 17 per cent drop in annual pre-tax profits hit by writedowns.

The company has unveiled 39 new pubs in the past 12 months, and plans to open about 40 this financial year.

Its chief executive, John Hutson, said: "There are more pubs that suit a Wetherspoon pub than ever before."

Wetherspoon's, which has 731 outlets, delivered record sales up by 5.2 per cent at £955m, boosted by a 2.5 per cent uplift in like-for-like bar sales in the year to 26 July. Sales of traditional ales grew by 17 per cent over the year.

However, its underlying food sales slipped by 0.4 per cent because it was up against strong comparables and hefty promotional activity last year.

Wetherspoon is considering options for refinancing £435m of revolving debt facilities that expire at the end of 2010, including a rights issue. It has one of the lowest net debt-to-Ebitda ratios in the listed pubs sector.

Keith Down, the company's finance director, said: "The bank market is open to us to replace that facility but we do not rule out any options."

Annual pre-tax profits fell to £45m, from £54.2m a year ago, after exceptionals of £21.1m, including £6.5m of pub writedowns and a £9.4m hit on fixed assets.