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Highlights
- J D Wetherspoon’s sales slumped below pre-pandemic levels.
- Chairman Tim Martin blamed older customers for the fall in sales, despite witnessing an increase in the younger clientele.
- The hospitality sector has been hit the hardest due to the pandemic restrictions.
The sales of pub chain J D Wetherspoon have plummeted below pre-pandemic levels, and chairman Tim Martin has blamed its older customers for not visiting the pubs due to coronavirus scare. As compared to the first 15 weeks of 2019, when the pandemic situation had not emerged, the sales were 8.9% less during the same period in the current financial year. Even after recording the highest sales in 2019 and showing signs of recovery recently, particularly outside of London, the 860-strong pub chain is witnessing falling share prices.
According to the pub chain, the sale of cocktails, vodka, and rum went up by 45%, 17%, and 26%, respectively. As these drinks are highly popular among youngsters, these figures indicate that the older clientele preferred to drink at home while the younger ones flocked the pub. This claim was supported by falling sales of its draught products, which are more popular among adults. There was a 20% fall in stout and a 30% fall in traditional ales.
According to an equity analyst at Hargreaves Lansdown, Wetherspoon could potentially face troubles in the long run if this trend of rising young customers and moving away from the older ones were to continue.
RELATED READ: Wetherspoons (JDW) & Marston’s (MARS): Should you buy these pub stocks?
The hospitality sector has been hit the hardest due to the pandemic restrictions. Let’s take a look at some of the affected stocks.
J D Wetherspoon plc (LON: JDW)
J D Wetherspoon plc is listed on FTSE 250 and has a current market cap of £1,228.92 million and it has given a negative return of 14.78% in 1 year. J D Wetherspoon plc’s shares were trading at GBX 954.50 as of 10 November 2021.
Restaurant Group Plc (LON: RTN)
The Restaurant Group plc runs brands include Chiquito, Firejacks, Coast to Coast, and Garfunkel's etc. The FTSE 250-listed company has a current market cap of £615.10 million and it has given a return of 24.22% in 1 year. Restaurant Group plc’s shares were trading at GBX 80.40 as of 10 November 2021.
City Pub Group Plc (LON: CPC)
The City Pub Group PLC operates, and manages an estate of pubs offering fantastic beer, delicious food, and excellent service. The current market cap of the AIM-listed company stands at £121.01 million, and it has given a return of 33.14% in 1 year. City Pub Group plc’s shares were trading at GBX 116.50 as of 10 November 2021.
RELATED READ: Should you wait to invest in these 3 hospitality stocks?
Mitchells & Butlers Plc (LON: MAB)
Mitchells & Butlers plc is engaged in activities like leisure retailing and property leasing. The FTSE 250-listed company has a current market cap of £1,436.93 million and it has given a return of 21.34% in 1 year. Mitchells & Butlers plc’s shares were trading at GBX 240.80 as of 10 November 2021.
Young & Co.'s Brewery Plc (LON: YNGA)
Young & Co.'s Brewery plc has two segments: Managed Houses and Ram Pub Company. The current market cap of the AIM-listed company stands at £495.44 million, and it has given a return of 44.29% in 1 year. Young & Co.'s Brewery plc’s shares were trading at GBX 1,440.00 as of 10 November 2021.
Loungers Plc (LON: LGRS)
Loungers PLC has cafes and restaurants under two famous brands: Lounge and Cosy Club. The current market cap of the AIM-listed company stands at £282.53 million, and it has given a return of 53.65% in 1 year. Loungers plc’s shares were trading at GBX 275.00 as of 10 November 2021
