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In reporting their annual results today, Tim Martin, chairman of J D Wetherspoon Plc, said: "I am pleased to report another record year for the company in sales and profit before tax and exceptional items, with total sales, including new pubs, increasing by £41.2 million to £996.3 million, a rise of 4.3% (2009: 5.2%) and profit before tax and exceptional items increasing by 7.3% to £71.0 million (2009: £66.2 million)." "We continue to seek to make lots of small improvements in diverse areas of the business, creating momentum in the services and facilities offered to customers, as well as sales and profits for the company. We have developed our breakfast offer by opening from 7am, the only substantial pub company to do so. We are now selling over 400,000 breakfasts and 600,000 coffees each week - an increase of 40%." "In the six weeks to 5 September 2010, like-for-like sales increased by 1.5% and total sales by 7.6%. Our sales, profit and cashflow continue to be resilient and the performance of our recently opened pubs is encouraging. The Board remains confident of a resilient performance by the company in the current financial year." "The biggest danger to the pub and catering industry is a continued increase in taxes and regulations. It is to be hoped that the UK government's attitude towards pubs, in particular, changes and that a co-operative and helpful, rather than a punitive, approach is adopted." The picture painted by Tim Martin ignores the underlying decline in beer sales affecting the liceneced trade, on a LFL basis sales increased 0.1% overall, whilst drink sales fell by 0.8%. Wetherspoon have managed to improve efficiency and operating margin after exceptional items increased to 9.0% from 7.9% which favourably affected the bottom line. The company opened 47 pubs during the year, 15 of which were freehold, and closed three others, resulting in a total estate of 775 pubs at the financial year end. As was the case last year, most new openings were of existing pubs, with rents and development costs being lower than historic trends. The average development cost for a new pub (excluding the cost of freeholds), in the financial year under review, was £0.86 million, compared with £0.85 million a year ago. The full-year depreciation charge was £43.7 million (2009: £45.1 million). In the financial year ending July 2011, they intend to open at least the same number of pubs as in the year under review. Notwithstanding the cost of these acquisitions / developments and paying a dividend of £26 million, net debt declined £1.6 million to £388 million. The business also repaid a US$140 million private loan from cash flow. Wetherspoons pioneered opening for breakfast in the pub trade and they are now selling over 400,000 breakfasts and 600,000 coffees each week - an increase of 40%. They are mindful of the approaching VAT increase and point out that in France VAT on food served in bars and restaurants has been reduced to 5.5%, and early evidence suggests that more tax has been levied by the French government as a result through, job creation, greater income tax, increased salaries for employees and increased corporation tax. Looking for commercial property fpr sale or a Commercial Property agents, find lettings and investment property in the UK? www.ukbusinessproperty.co.uk
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