JD Wetherspoon: What the experts say

By THIS IS MONEY
Updated: 06:37 EST, 20 January 2010

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JD Wetherspoon has taken a blow from the cold snap, with New Year sales figures down on last year as the big freeze prevented drinkers from getting to its pubs.

Cold comfort: Wetherspoon pubs were quieter than normal during January's big freeze

The numbers:

• Like-for-like sales for the 12 weeks to 17 January were down 0.3% on last year.

• Total sales in the 12-week period increased by 3.7%.

• In the year to date (25 weeks to 17 January 2009), like-for-like sales increase by 0.1% and total company sales, including recently opened pubs, increased by 4.1%.

• Operating margins for the half year (ending 24 January 2010) are expected to be in line with the same period last year, with the benefit from lower energy costs being offset by a higher level of repairs expenditure caused by the cold snap.

• The company has reduced debt by £50m in the past twelve months, with refinancing of its main £435m lending facility underway.

• Wetherspoon has opened 15 new pubs so far this financial year, bringing the current number of pubs to 744.

• The firm expects to open around 50 new pubs in the coming financial year and 250 new premises over the next five year, as part of an investment programme worth £250m.

JD Wetherspoon shares today:

• Shares in the firm fell 2.50p, or 0.54%, to 461.2p but stock has nearly doubled in value over the past 18 months.

• See JD Wetherspoon shares data updated throughout the day here...

What the experts said:

• 'JD Wetherspoon is the first UK leisure company to report on trading through the recent adverse weather conditions and it shows the severity of two weeks of snow on like-for-likes for pubs,' said Seymour Pierce analyst Hugh-Guy Lorriman.

• Market expectations for JD Wetherspoon's full-year pretax profit currently range between £61m and 76m, with the consensus at £71m, according to a Thomson Reuters poll of 19 analysts.

• KBC Peel Hunt analyst Paul Hickman sees the current price as a buying opportunity. 'The period between now and September should include the finalisation of the refinancing and it is likely to be the first of the pubcos that cut their dividend two years ago to restore it,' he said.

JD Wetherspoon on This is Money:

From January 2010 - Six FTSE 250 stock tips for 2010. Read more...