(Reuters) - British pubs operator JD Wetherspoon (JDW.L) reported its slowest sales growth in at least seven years on Friday and warned higher taxes would squeeze future results.
Wetherspoon said revenue rose 1.4 percent to 801.4 million pounds for the half year to January 22, down from growth of 6.2 percent a year earlier.
For the six weeks ended 5 March revenue fell 0.2 percent, it said, after posting a gain of 5.7 percent for the same period a year earlier.
In January, Wetherspoon warned of lower like-for-like sales and higher costs in the next six months.
Following the British government’s 2017 budget announced on March 8, the company, which is already grappling with higher costs, said it faced an increase in taxes and duties of at least 20 million pounds next year.
“Wednesday’s budget will weigh far more heavily on pubs than supermarkets, especially since wage costs per pint or meal are approximately 10 times higher in pubs,” J D Wetherspoon Chairman Tim Martin said in a statement.
Wetherspoon is seemingly the most exposed of Britain’s managed pub operators to any economic slowdown and the company can no longer use space for growth, Berenberg analysts said in a note.
Finance minister Philip Hammond warned on Wednesday that Britain’s growth from next year to the end of the decade would be weaker than previously thought and would only return to 2.0 percent in 2021.
Wetherspoon’s pretax profit after exceptional items rose 9 percent to 39.9 million pounds and it said it would maintain its full-year dividend at 4 pence per share.
Shares of JD Wetherspoon were down 3.4 percent at 931 pence in early trade.
Reporting by Abhijith Ganapavaram in Bengaluru; editing by Jason Neely