Wetherspoons pubs in Newcastle and rest of UK report £155m record losses amidst labour shortages
JD Wetherspoons, which has around eleven pubs in Newcastle, has reported a record annual loss following 19 weeks of closures as a result of COVID lockdowns.
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In an update to investors, it posted a £154.7 million loss in the year ending on 25 July, as losses of £34.1 million were recorded for the year prior.
Even though the firm ensured there were signs of recovery as the world slowly returns to life pre-pandemic, it is struggling to fill vacancies in some areas across the country.
Weatherspoon’s chairman Tim Martin, who is a big Brexit advocate, criticised the government’s reaction to the pandemic as being “draconian.”
The company said that like-for-like sales, which rule out the impact of new pub openings, are only down 8.7% in the last nine weeks than in a similar period before national lockdowns.
Overall, reports state that revenues from meals, pints, and soft drinks have fallen by 38.8% from the year before to £772.6 million.
During a conversation with shareholders, Martin was fairly confident that the situation will eventually ease ahead of the next financial year.
"Pubs have been at the forefront of business closures during the pandemic, at great cost to the industry - but at even greater cost to the Treasury.
"In spite of these obstacles, Wetherspoons is cautiously optimistic about the outcome for the financial year, on the basis that there is no further resort to lockdowns."
The firm is also undergoing slight labour shortages in various areas in the UK as it struggles to fill vacancies.
This is an issue plaguing the entire hospitality sector, with the Office for National Statistics revealing that the industry had 135,000 vacancies in August.
Wetherspoons have said that it has received a “reasonable” number of applications, but are finding workers in areas such as the West Country harder to find.
The company is also finding itself in a tougher financial climate, as a rise in VAT from 5% to 12.5% will take effect from Friday.
Though a spokesperson ensured that if these changes were to remain permanent, “the company intends to retain lower prices indefinitely.”