Wetherspoon ( J.d.) Share Discussion Threads

[gozzie2] 25/4/2022 14:29

Price is not amongst the most important decisions someone makes when visiting a pub .Eh???? Its absolutely why the vast majority visit Spoons. Try charging 6 pounds a pint and see how many customers you attract lol.

[gozzie2] 25/4/2022 14:01

Summary of questions from investors and answers from Wetherspoon from the Interim Results Investor Roadshow, March 2022The following questions were raised by analysts and investors after the release of the company's half year results on 18 March 2022. The answers are a summary of those provided by the company's management. The company believes it helpful for this summary to be made available to a wider audience. Forward-looking statements were made by the directors in good faith using information available up until the date that they provided the answers. Forward-looking statements should be regarded with caution because of inherent uncertainties in economic trends and business risks. The company undertakes no obligation to revise or update any forward-looking statement, regardless of whether those statements are affected as a result of new information, future events or otherwise, save as required by law and regulations.1) Can you talk us through the sales journey over the last couple of months?As has been widely reported, Plan B restrictions adversely affected sales. Since the restrictions were lifted, sales have improved.2) We see you put the price of a pint up 10p recently. Have you any other plans for price increases?We try to avoid making statements about price rises. Our general policy is to remain as competitive as possible. In the medium and longer term, at the risk of stating the obvious, some price rises are inevitable in an inflationary environment. 3) How do you think the company might trade through the probable recession?Wetherspoon has experienced a number of recessions and downturns in the last 43 years. In general, we have traded reasonably well in these circumstances. Lockdowns and restrictions, which had never been implemented before, have been a nightmare in comparison. 4) Are customers being a bit more cautious about spend levels?Common sense would indicate that they are, but it hasn't affected our trade so far, which has improved in recent weeks, as we've reported.5) Can you give us some examples of what you're working on to try and increase sales? We've always referred to the 1000 components of a BMW. We try to improve every component as time goes by.We have, for example, been promoting coffee and breakfast sales recently, which have been affected by 'working from home', and are promoting traditional ale, often consumed by older customers, who have been cautious about visiting pubs. We have also increased rates of pay for staff and have improved benefits, including free meals on duty. 6) Are you seeing any variation in trading in the regions? Are there differences between cities and towns?As has been widely reported, London has been slow. In contrast some big city centres, like Liverpool, Manchester and Birmingham, have been strong. There does not seem to be a pattern. Perhaps some suburbs have been slower than the market was anticipating – working from home doesn't necessarily increase suburban trade, if the suburbs are within 'striking distance' of the city centre. Lloyds bars, which have music and appeal to a younger clientele, have outperformed Wetherspoon pubs. Hotels, a small part of our business, have traded well.7) It's good increase to volumes, but surely there comes a time when you might look to make more money by raising prices?We increased sales and profits for about 40 years up to the pandemic, albeit we were sometimes advised to increase prices during this time. We don't have a 'doctrinaire' approach and have increased prices from time to time, but aim, overall, to stay competitive. More than that, it's difficult to say...8) How price sensitive are customers?Many surveys over the decades have said that price is not among the most important factors in making a decision to visit a pub. Atmosphere, cleanliness, friendly staff and so on, may be more important. Our view is that prices are, nonetheless, important, but that varies from customer to customer. 'Careful' customers are more numerous than some surveys reveal, even among the affluent...9) Can you talk us through the cost inflation that the company is seeing and expects to see over the next few months?We have fixed interest rates at a low level to 2031. For many years, almost all the new leasehold pubs we acquired have had fixed rental increases, which are well below the current level of inflation. We're protected, to some extent, by long-term supplier contracts, but, even so, are feeling the effects of inflation in respect of energy costs and food supplies especially. In combination, we hope that our total cost increases will be about 1 or 2% below the level of inflation.10) How focused are the pubs on reducing energy consumption?We have always tried to minimise energy costs, but will reinvigorate our efforts in this area in the course of the next few weeks and months. 11) What wage rate growth can we expect over the next 12 months?Reflecting trends in the hospitality industry, from 2013 to 2021, average pay rates per hour at Wetherspoon increased by 5.5% per annum, compared to consumer price inflation rates which averaged 1.7% per annum1. In 2022, labour costs have increased by 7.7%. Future pay increases will probably depend, above all, on the performance of the UK economy – an unknown at the current time.12) A lot of competitors say that Brexit has reduced the supply of labour. What is your view?The respected Worldometer website gives a UK population of 66.3 million in 2016, the year of the referendum, increasing to 68.5 million in April 2022. Immigration levels are slightly reduced from the years preceding the referendum, but not by much. Europe, the US and Australia have also reported labour shortages, perhaps due to what the Washington Post has referred to as 'the Great Reassessment', whereby people have retired, changed jobs, or reduced working hours. Having said that, as the company has stated on a number of occasions, a preferential visa system for EU countries would be helpful to the UK economy. This can be justified on the basis of 'proximity', similar to the arrangements between the UK and Ireland, and Australia and New Zealand, for example.13) Repairs expenditure looks like it is in line with the pre-pandemic period? Can you talk us through what's happening there?Repairs in the first half were approximately the same as repairs in the first half of FY20. There is a temptation to reduce expenditure on repairs in downturns, but we try to avoid this, since it stores up trouble and reduces 7) It's good increase to volumes, but surely there comes a time when you might look to make more money by raising prices?We increased sales and profits for about 40 years up to the pandemic, albeit we were sometimes advised to increase prices during this time. We don't have a 'doctrinaire' approach and have increased prices from time to time, but aim, overall, to stay competitive. More than that, it's difficult to say...8) How price sensitive are customers?Many surveys over the decades have said that price is not among the most important factors in making a decision to visit a pub. Atmosphere, cleanliness, friendly staff and so on, may be more important. Our view is that prices are, nonetheless, important, but that varies from customer to customer. 'Careful' customers are more numerous than some surveys reveal, even among the affluent...9) Can you talk us through the cost inflation that the company is seeing and expects to see over the next few months?We have fixed interest rates at a low level to 2031. For many years, almost all the new leasehold pubs we acquired have had fixed rental increases, which are well below the current level of inflation. We're protected, to some extent, by long-term supplier contracts, but, even so, are feeling the effects of inflation in respect of energy costs and food supplies especially. In combination, we hope that our total cost increases will be about 1 or 2% below the level of inflation.10) How focused are the pubs on reducing energy consumption?We have always tried to minimise energy costs, but will reinvigorate our efforts in this area in the course of the next few weeks and months. 11) What wage rate growth can we expect over the next 12 months?Reflecting trends in the hospitality industry, from 2013 to 2021, average pay rates per hour at Wetherspoon increased by 5.5% per annum, compared to consumer price inflation rates which averaged 1.7% per annum1. In 2022, labour costs have increased by 7.7%. Future pay increases will probably depend, above all, on the performance of the UK economy – an unknown at the current time.12) A lot of competitors say that Brexit has reduced the supply of labour. What is your view?The respected Worldometer website gives a UK population of 66.3 million in 2016, the year of the referendum, increasing to 68.5 million in April 2022. Immigration levels are slightly reduced from the years preceding the referendum, but not by much. Europe, the US and Australia have also reported labour shortages, perhaps due to what the Washington Post has referred to as 'the Great Reassessment', whereby people have retired, changed jobs, or reduced working hours. Having said that, as the company has stated on a number of occasions, a preferential visa system for EU countries would be helpful to the UK economy. This can be justified on the basis of 'proximity', similar to the arrangements between the UK and Ireland, and Australia and New Zealand, for example.13) Repairs expenditure looks like it is in line with the pre-pandemic period? Can you talk us through what's 22) Are you happy with debt levels? What are the current thoughts about debt reduction?The pandemic will inevitably mean greater anxiety and caution regarding debt, which we will take into account in our capital expenditure plans. It is difficult to be precise, because the exact level of debt will depend on an assessment of the risks, opportunities and the returns on capital in future years.23) Will you be closing or selling pubs over the next few years?We have sold a number of pubs in recent years, mostly where we have another pub in close proximity. There may be a dozen or so similar examples, in the course of the next few years. 24) With hindsight, did you need to raise the money from the share placings?Good question. At the half year end, we had liquidity of £159m, so it's possible to argue that we raised too much money. However, given the level of uncertainty, an element of caution was probably correct. Had we raised no money, sleepless nights would have been inevitable for the company, lenders and for shareholders...25) When might you pay a dividend again?Our best estimate is that profits would need to return to about pre-pandemic levels.26) What have sector peers done with their prices?It has been widely reported that prices in the industry generally have risen in recent months, which accords with our anecdotal evidence and experience. 27) Has there been a reduction in the number of competitor pubs?The have been many reports of pub and restaurant closures, although in some instances a new operator has taken over closed premises. 28) What is the off-trade doing with prices?Supermarkets pay no VAT in respect of food sales, whereas pubs pay 20%. This amounts to a tax subsidy for supermarkets, allowing them to reduce drinks' prices, putting pressure on the entire pub and restaurant industry. It is a principle of taxation that it should be fair and equitable. Encouraging pubs and restaurants, key components of beleaguered high streets, which produce higher taxes than supermarkets anyway, is essential for optimal UKeconomic performance. We are right on this point, and MPs and Treasury officials are intelligent, so they will get there in the end...happening there?Repairs in the first half were approximately the same as repairs in the first half of FY20. There is a temptation to reduce expenditure on repairs in downturns, but we try to avoid this, since it stores up trouble and reduces

[mroalan] 23/4/2022 09:52

Mark Steyn on the shocking truth about the booster jab
By
Kathy Gyngell
-

April 23, 2022
He,s calling for a royal commission, no chance! but the blag is truly up and in plain sight but little has changed, which shirley has to sooner or later, or are the consequences for gov ect just to big to contemplate? mro



Same thing happening in Canada

[gozzie2] 22/4/2022 15:31

They had underlying conditions for many years.Not very serious that it had killed them previously ,but as soon as they contracted covid it saw them off The vast majority before vaccine though .The vaccine is waining though and people less concerned .It could still be a problem ahead .

[gozzie2] 22/4/2022 15:27

Fair enough, but covid is a contributing factor in many deaths as friends of mine found out .

[biffa58] 22/4/2022 12:33

But there weren't 646 deaths yesterday . The 646 was by date reported . If you go there is chart for "Deaths within 28 days of positive test by date of death" If you click on the 1m, the latest days are not complete but the trend is downwards from a high around 8th April. Similarly the daily deaths with covid on the death certificate by date of death shows around 160 per day.
These are all figures for "with" rather than "from"

[gozzie2] 22/4/2022 10:18

646 deaths in one day with covid yesterday, the highest since February 2021.Not widely reported. How convenient.

[isis] 20/4/2022 17:08

Was in London, not Central though. There are vast differences from Pub to Pub in pricing. A round for 5 can vary drastically, they just make the prices up I feel.
At least with a Spoons they are consistent but the Central London ones can be expensive too.

[gozzie2] 20/4/2022 16:42

LolI had a similar experience in a five guys burger joint.12 quid for a cheeseburger and chips.I gave them a tenner.I don't know who should be more embarrassed, me or them .

[pottsypotts] 20/4/2022 15:54

Wow that has to be somewhere down London

[essentialinvestor] 20/4/2022 15:53

Well there's an interesting read from that - will JDW benefit from possible trading
down?.


However, I will take my cue from Tim, he's been an astute reader of the JDW SP
down the years - if he makes a significant purchase then I'm in.

[gozzie2] 20/4/2022 13:20

Absolutely. Not a chance these expensive places will survive.FACT

[pottsypotts] 20/4/2022 12:50

I have yet to go in a spoons that isn't busy selling pints to the hardened drinkers and food to plenty others Like you say with the competition maybe getting out of reach for some surely it's only time before this share starts to come back up

[likeawalrus] 20/4/2022 11:16

we went to my local for a late lunch yesterday but the fryers were out of service (love their cod & chips) so we went to pizza express instead, very nice but £57 compared to the £30 we would have spent in jdw. share price on the back foot but surely it cant stay this low for long when the competition is so expensive?

PS a glass of coke in pizza express is 60p more expensive than a pint of Doom Bar in jdw

[gozzie2] 20/4/2022 10:23

High inflation .High energy pricesLow growth. Things don't get better in 2023 .

[gozzie2] 19/4/2022 11:56

They are now walking back slowly from the foodbank ,having been supplied with a bobhat and scarf to sit indoors.Now wheres that 350 million a week for the NHS Eh ?????

[gozzie2] 19/4/2022 11:54

Yeah ,about the same number of d#mbos that voted for brexit lol

[zztop] 19/4/2022 11:52

https://thetruedefender.com/uk-gov-admits-19-2-million-in-england-didnt-get-a-single-dose-of-covid-19-vaccine/

[stpalm] 19/4/2022 10:26

Cash is king but freeholds are a close 2nd. Until some clever CEO does a sale and leaseback to increase EPS for a year or 2 then hard times hit and someones stolen the silver. I can think of many co's have done that. BT comes to mind 1st. It increases cost of dept and gives no security blanket

[mroalan] 18/4/2022 15:51

Yes years ago whilst doing a bit for Boots they decided to sell all there properties, bad move.

[k mon] 18/4/2022 12:27

Exactly MR O..

I remember first coming across WS .. they chose buildings like old Banks etc..
as locations..

But what struck me later on .. was this ..
It's not really a pub chain...

what the 'Financial Vehicle' is
... is a Property Company ... with a 'Pub' Tenant... who pays little Rent.
as the 'Value Increase'.. is in the property .. not the profitability of the Operation... is what underpins the 'Value'..

You see .. most pubs in England .. are Leaseholds .. so must pay major Breweries etc.. 'Rent'.. for the privilege to sell their beer.

But WS .. by 'owning' the property.. can undercut the entire market
.. sell at whatever they like
.. just so long as the operational costs are covered ..
and the operational costs are lower .. because they will have little or no Rent.

- Inflation & the increase in property prices .. almost guarantees the 'Value'
.. of the share price..

- Clever.(and also Tax 'efficient'.. )

-- You've got to like the business model..

[mroalan] 18/4/2022 08:46

£7 for a pint, well you wouldn,t would you? just on a point of principal, a night out for me four pints =£6 now thats value

[mroalan] 18/4/2022 08:39

K Mon, Spoons has some of the best looking buildings, well there more than that, great architecture/listed? remember visiting Blackpool a few years ago they had just finished "The Velvet Coaster" never seen the like of it for a pub in those days.
Beer did increase in price here but was short lived, now back to £1 49 for real ale, still busy here.

[tim 3] 16/4/2022 23:59

Well its surprised me not just over Easter but in the last few weeks pubs round here have been packed even midweek.

Maybe with everything thats gone on people are just thinking sod it lets live for today!