Pub chain JD Wetherspoon has seen a rise in sales figures.
In the 11 weeks to July 12, the company reports like-for-like sales climbed 2.9 per cent, while total sales were up 6.5 per cent.
Year-to-date figures were also positive. Like-for-like sales grew 3.4 per cent and total sales saw a rise of 7.4 per cent. However, the company reported that pre-tax profit for the year was "unlikely" to be higher than last year. Preliminary results will be reported on September 11th.
Wetherspoon has opened 26 new pubs over the last year and disposed of six. The pub group says it plans to open 20 to 30 new pubs in the next year and offload 20. In the last year, the company also brought back 1,621,163 shares at a total cost of £12.5 million
In a statement, the company also predicted that next year's trading performance will be in line with or slightly above this year. This, they say, is due to ongoing competition from supermarkets and increased staff costs.
The living wage
Wetherspoon chairman Tim Martin says that the government's new living wage has added "considerable uncertainty" to the pub industry.
The living wage, which was part of the Budget that George Osborne announced last week, will mean in increase in minimum wage and Mr Martin believes this will affect pubs more than supermarkets.
He explained: "The average price of a pint in a supermarket is less than £1 and we estimate staff costs to be around 10 per cent or 10p. In contrast, a pint in a pub costs around £3 and staff costs are about 25 per cent or 75p. Increased labour costs therefore affect pubs with far greater force than supermarkets."
He added that pubs contribute around 40 per cent of sales as taxes and that the industry is an important source of jobs.
"Capricious initiatives by the government, widening the financial disparity between pubs and supermarkets, will threaten the future of many more pubs," he said.
Mr Martin believes the government should "harmonise" the tax VAT and business rates for pubs and supermarkets. For many years, he has campaigned against "excessive" tax on the pub trade and says pubs should not have to pay 20 per cent VAT on hot food.
In early trading, stocks for JD Wetherspoon were down 4.86 per cent to 733.5, compared to yesterday's closing rate of 771.00.