JD Wetherspoon shares climb 12% despite challenging times
JD Wetherspoon has produced a smaller than expected loss for the full-year and is controlling costs in a rising cost environment.
Video Transcript
JD Wetherspoon earnings
Pub chain JD Wetherspoon is in the news today for all the right reasons. Despite the fact it reported a loss on earnings, it actually scored a better figure than had been expected.
We've got rising costs from energy and wages, while the industry is facing a challenge to get people back to its pub - it's been a tough time, of course, from COVID.
These are the numbers, pretax loss before exceptional items, coming in at a better than expected £30.4 million loss. Sales in the full year fell 4.3% to £1.74 billion. The change recovery has been held back by the rising cost of labour, ingredients and also energy. Its bottom line has also been hit by the rising cost of repairs which has been put off during the pandemic.
Share price chart
Let's take a look at the share price chart because it has been pretty much one way traffic for some time now since the highs that we saw back a year after COVID, April 2021, all the way up at £14.30.
Here we are now at around about the £5 level. We're trading up today by a margin of 14.7%. It really has been a stunning recovery and well past this line of prior support resistance which has now become support again at 468, so 499p or £5 a share stop riding very high today relative to the moves that we've seen.
But even with this big percentage rise you can see it is only a small move up in what has been a dire time in terms of shareholder value in the stock.
The pub chain is by no means out of the woods, but if they can continue to improve the picture at a better rate than analysts have been looking for, then there could well be further upside.
But the cost of living is biting individuals and it's this that the pub chain is most worried about.
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