In its interim results, the company reported like-for-like (lfl) sales across JDW’s 800-strong estate were up 4.8% in the 26 weeks ended 26 January 2025 compared to the previous year.
Bar sales saw a 4.3% uptick while food and slot/fruit machine sales rose 5.4% and 12.4% respectively.
Revenue for the period was up 3.9%, from £991m in 2024 to £1,029.5m.
However, profit before tax saw an 8.6% downturn, dropping from £36m to £32.9m. Operating profit also decreased, from £67.7m to £64.8m (4.3%).
JDW’s operating margin, before separately disclosed items, was 6.3% (2024: 6.83%), mainly due to labour and utility costs which, in total, were £30.6m higher.
Disproportionate impact
Following the results, JDW chairman Tim Martin detailed the increases to national insurance and labour rates would cost the company an additional £60m per year, equating to approximately £1,500 per pub, per week.
Martin said: “Since labour costs are around 35% of the pub industry’s sales, compared to around 11% for supermarkets, increases of this nature inevitably have a disproportionate impact on pubs, exacerbating the already-wide price differential for customers between the on and off-trade.
“The combination of much higher VAT rates for pubs than supermarkets, combined with increased labour costs will weigh heavily on the pub industry.”
Total capital investment stood at £64.6m (2024: £57.2m), with £10.4m invested in new pubs and pub extensions (2024: £10.5m), £40.6m in existing pubs and IT (2024: £34.6m) and £13.6m in freehold reversions of properties where JDW was the tenant (2024: £12.1m).
In addition, the company stated pub disposals had given rise to a cash inflow of £3.9m.
Reasonable outcome
The company added it expected to open a further five franchise pubs in the second half of the current financial year – four of these will be at Haven Holiday Parks.
Debt, excluding IFRS-16 lease debt, was £703.5m at the period end, compared to £664.8m in July last year. The total tax charge for the period was £8m.
Total available finance facilities were £938m. On 6 June 2024, the company signed a new four-year £840m banking agreement on “attractive terms”.
In the last seven weeks to 16 March 2025, lfl sales increased by 5%.
Martin added: “The company currently anticipates a reasonable outcome for the financial year, subject to our future sales performance.”
