JD Wetherspoon (JDW) chairman Tim Martin has made his thoughts on the recent EU vote clear and, judging by the recent surge in the share price, it hasn't put the punters off. Shares in the pub group have rocketed 45 per cent since the end of June to a high of 971p, suggesting a fair few celebratory pints were raised. But reasons for caution remain. Operating margins before exceptional items decreased from 7.4 per cent to 6.9 per cent, mainly due to higher staff costs and utility bills. Staff wages rose twice before the national living wage announcement, but it's unclear whether another increase will be necessary.
Elsewhere, adjusted earnings per share growth of 2.8 per cent was flattered by £53.6m of share buybacks. Mr Martin now owns nearly 29.5 per cent of the group's shares and has to apply to City regulators to avoid the mandatory bid those owning 30 per cent of shares in a company are required to make before he can buy any more. Also, while group like-for-like sales rose 3.4 per cent, only bar sales produced a greater like-for-like growth rate - food sales growth was half as strong as in FY2015.
Analysts at Numis expect pre-tax profit of £81.1m for the year to July 2017, leading to EPS of 52.8p, up from £80.6m and 48.3p in FY2016.
| JD WETHERSPOON (JDW) | ||||
|---|---|---|---|---|
| ORD PRICE: | 967p | MARKET VALUE: | £1.10bn | |
| TOUCH: | 967-968p | 12-MONTH HIGH: | 980p | LOW: 590p |
| DIVIDEND YIELD: | 1.2% | PE RATIO: | 22 | |
| NET ASSET VALUE: | 182p | NET DEBT: | 314% | |
| Year to 24 Jul | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 1.20 | 58.9 | 35.6 | 12.0 |
| 2013 | 1.28 | 57.1 | 37.8 | 12.0 |
| 2014 | 1.41 | 78.4 | 33.9 | 12.0 |
| 2015 | 1.51 | 58.7 | 37.9 | 12.0 |
| 2016 | 1.60 | 66.0 | 44.5 | 12.0 |
| % change | +5 | +12 | +17 | - |
Ex-div: 20 Oct Payment: 24 Nov | ||||
