Pubs chain swings to loss
Wetherspoon boss calls for ‘sensible’ framework
Pubs have seen a sharp fall in sales (pic: Terry Murden)
Wetherspoon chairman Tim Martin said the company and the entire hospitality industry need a “more sensible and consistent regulatory framework” in which to operate after the pubs chain swung to a £34 million loss.
The company, which reported a £102m profit in 2019, said like-for-like sales for the year to 26 July fell 29.5%.
Mr Martin said the current environment of lockdowns, curfews and constantly changing regulations and announcements threatens not only pub companies, but the entire economy.
“The most important lesson, as Professor Mark Woolhouse of Edinburgh University has said, is that “lockdown just defers the problem; it doesn’t solve it”.”
He said the government and its advisers “were clearly uncomfortable as the country emerged from lockdown.
“They have introduced, without consultation, under emergency powers, an ever-changing raft of ill-thought-out regulations – these are extraordinarily difficult for the public and publicans to understand and to implement. None of the new regulations appears to have any obvious basis in science.”
“For example, a requirement for table service was introduced – which is expensive to implement and undermines the essential nature of pubs for many people – pubs have now become like restaurants. Customers can approach the till in a shop, but not in a pub – which is, in no sense, ‘scientific’.
“In addition, face-coverings, for which the health benefits are debatable, need not be worn while seated, yet must be worn to go to visit the bathroom – another capricious regulation.
“The most damaging regulation relates to the 10pm curfew, which has few supporters outside of the narrow cloisters of Downing Street and SAGE meetings.
“This has meant that many thousands of hospitality industry employees, striving to maintain hygiene and social-distancing standards, go off duty at 10pm, leaving people to socialise in homes and at private events which are, in reality, impossible to regulate.
Tim Martin: ‘damaging regulations’
“In marked contrast to the consistency of the comparatively successful Swedish approach, which emphasises social distancing, hygiene and trust in the people, the erratic UK government is jumping from pillar to post and is both tightening and tinkering with regulations, so we are now in quasi-lockdown which is producing visibly worse outcomes than those in Sweden, in respect of both health and the economy.
“Risk cannot be eliminated completely in pubs, but sensible social-distancing and hygiene policies, combined with continued assistance and co-operation from the authorities, should minimise it.”
Revenue for the year fell 30.6% to £1.26bn and no dividend has been proposed.
Mr Martin said like-for-like sales in the first 11 weeks have been 15% below those of last year, with strong sales in the first few weeks, followed by a marked slowdown since the introduction of a curfew and other regulations.
“The recent curfew and introduction of table service only have been particularly damaging for trade, depressing sales for customers who find it too much ‘faff’, at the same time as substantially increasing costs,” he said.
“As a result of recent changes in regulations, the outlook for pubs over the remainder of the current financial year is even more unpredictable than hitherto.”