British pub group JD Wetherspoon said on Friday sales in the first nine weeks of its financial year rose nearly 10% on strong demand for its lower-than-average priced drinks and food amid a cost-of-living crisis.
Resilient customer spending has helped the UK hospitality industry manage pressures from high costs as they continue to recover from the pandemic lows.
Cost Of Living Crisis
However, a cost-of-living crisis remains a threat as cash-strapped shoppers restrict discretionary spending.
JD Wetherspoon, which owns and operates pubs across UK and Ireland, said like-for-like sales increased by 9.9% first nine weeks of the current financial year to Oct 1.
The pub group said profit before tax for the year ended on July 30 was £42.6 million ( €49.2 million), from the £30.4 million (€35.1 million) loss it reported a year earlier.
In July, JD Wetherspoon chairman Tim Martin said the British pub chain was expecting better results next year amid signs that soaring food and energy costs were starting to cool, lifting its shares by 11%.
Pubs and restaurant groups have been hit hard by forced closures during the COVID pandemic followed by red-hot inflation in Britain, which has pushed up costs and squeezed margins.
'Promising Green Shoots'
However, "promising green shoots" are seen for energy and some food costs, which has helped lift expectations, Martin told Reuters.
The company also offloaded some pubs to keep a check on costs and reduce debt.
Like-for-like sales in the first 10 weeks of the fourth quarter, ending July 31, were up 11% from the same period pre-pandemic in 2019 and rose 11.5% compared to same the period last year.
Article by Reuters, additional reporting by Hospitality Ireland.