* Sale of coffee, real ale and gin boost results
* J D Wetherspoon keeps drink prices low
* Costs remain high
(Adds chairman, analyst comments)
By Noor Zainab Hussain
Sept 13 (Reuters) - J D Wetherspoon's pretax profit
rose in the full year as its "cheap and cheerful" pubs pulled in
customers seeking pink gin and coffee as well as traditional
beer even as Brexit worries hurt overall consumer confidence and
spending.
Britain's Wetherspoon, like most restaurant chains in the
country, has been battling increased costs due to a minimum wage
hike, higher property prices and power bills. It has also been
investing in its more labour-intensive food and coffee business.
It has however still managed to attract patrons to its more
than 900 pubs in Britain and Ireland as it keeps drinks prices
low, providing a cheaper alternatives for Britons who often face
high costs to drink in pubs, restaurants and clubs.
Pretax profit after exceptional items rose to 95.4 million
pounds ($118.5 million) for the year ended July 28 from 89
million pounds a year earlier, although before exceptional
items, it fell 4.5% to 102.5 million pounds.
"Costs were quite high as we invest in the business and
gardens and kitchens and people," Chairman Tim Martin, a vocal
Brexiteer, told Reuters.
Initially called Martin's Free House, Wetherspoon has also
been spending to upgrade facilities at its older pubs.
Total sales rose 7.4% to 1.82 billion pounds, while
like-for-like sales rose by 6.8%, with a jump in bar and food
sales.
Senior market analyst Fiona Cincotta at Cityindex said the
company had fared a lot better than many of its rivals.
She warned however that the rate of sales growth had slowed,
putting more pressure on the company's already-thin margins.
"J D Wetherspoon may be attracting plenty of people into its
pubs but it's luring them with such cheap prices that its
margins have deteriorated," she said.
Rival Greene King said earlier this year that a wet
summer and poor sentiment had hurt its sales in its new
financial year.
PINK GIN WITH STRAWBERRIES
Wetherspoon's like-for-like sales rose 5.9% for the six
weeks to Sept. 8. Martin said growth recently and in the full
year had come from the sale of coffee, real ale and also gin.
"Everyone is drinking gin. Even the guys from the building
sites down the road are drinking pink gin with strawberries. It
is quite a revolution," he said.
The company's performance comes at a time when the UK's pub
sector is brimming with deals.
Greene King is set to be bought by Hong-Kong's Ck Asset
for 4.6 billion pounds, while Slug and Lettuce pub
chain owner Stonegate has agreed to buy Ei Group for
1.27 billion pounds.
($1 = 0.8048 pounds)
(Reporting by Noor Zainab Hussain and Tanishaa Nadkar in
Bengaluru; Editing by Arun Koyyur and Jan Harvey)
