MARKET REPORT: Wetherspoons boss toasts return to profitability

Wetherspoons caused a ray of light amid a sea of ​​red on the London Stock Exchange after it issued an upbeat trading statement.

Outspoken boss Tim Martin warned that “wild” inflation has hit his pubs across the country. But Wetherspoons returned to a profit of £4.6m in the six months to January 29, after posting a loss of £26.1m in the same period a year ago.

In another boost, sales in the seven weeks ended March 19 were 9.1 percent above pre-pandemic levels in 2019.

As stock markets around the world tumbled, Wetherspoons shares rose 13.6 per cent, or 79p, to 660p. However, Martin did not get carried away.

“Inflationary pressures in the pub industry have been, as many companies have said, severe, particularly in relation to energy, food and labour,” he said.

Bright spot: Wetherspoons returned to £4.6m profit in the six months to January 29

The industry has recovered from the worst of the devastation of the Covid pandemic. Jonathan Neame, the boss of Britain’s oldest brewery Shepherd Neame (flat at 595p), ​​said this week after-work drinks are making a comeback as staff return to offices. Neame said sales in London in the six months to Christmas were 39 per cent higher than a year earlier.

Hargreaves Lansdown’s Derren Nathan praised Wetherspoons for a “solid start to the year”.

He added: “In the longer term, we see Wetherspoons as a prime example of economic Darwinism. A company whose business model and brand are likely to emerge stronger from a challenging period.’

Rival pub chains Mitchells & Butlers were up 0.4 per cent, or 0.7 pence, to 160.2 pence and Marston’s fell 2 per cent, or 0.72 pence, to 35.22 pence. The FTSE 100 fell 1.3 percent or 94.15 points to 7405.45 and the FTSE 250 slipped 1.3 percent or 236.13 points to 18493.83.

Stock markets around the world plummeted amid further turmoil in the global banking system. In Europe, Germany’s key benchmark fell 1.7 percent, as did France’s Cac.

Back in London, oil majors traded lower after demand fears for Brent crude fell to around $73 a barrel. BP fell 2.5 percent or 12.4 pence to 486.3 pence and Shell slipped 3.2 percent or 71.5 pence to 2200.5 pence.

There was good news for Warpaint London after the company posted record first quarter sales of more than £16m. This was more than the £13.2m it earned in the same period last year and followed a strong finish into 2022.

As a result, forecasts for 2023 will now be ahead of previous expectations. Shares rose 2 percent, or 4 pence, to 201.5 pence.

Warhammer figure maker Games Workshop said its trading for the three months to the end of February was in line with expectations. Shares rose 1.1 percent or 95 pence to 9115 pence.

Tui, the world’s largest travel company, has handed shareholders £1.6 billion to pay off a debt to the German government for support during the pandemic.

Berlin handed over £3.5billion in survival loans to the company as travel restrictions during Covid wrecked business. Tui is trying to raise money from shareholders to pay off its debt. Shares fell 2.4 percent or 33.5 pence to 1380 pence.

Meanwhile, Smiths Group raised its annual sales target for the second time this year.

The engineering company expects revenue growth of at least 8 percent for the year ended July 31, just two months after upgrading that guidance to at least 7 percent.

The improved outlook came after the company reported record revenue growth of 13.5 percent in the six months ended January 31. Shares fell 0.3 percent or 5.5 pence to 1710 pence.