JD Wetherspoons boss Tim Martin has hit out at the “catastrophically poor judgement” of economists who predicted a post-Brexit slowdown as he reported better-than-expected sales across his pub chain.
The outspoken chairman and Brexit campaigner said the underlying reason for the “apocalyptic” predictions from leading UK economists was their “semi-religious” belief in the European Union as a result of a 30-year misunderstanding.
“The majority of economists, economic institutions, politicians and intellectuals has consistently misunderstood the implications of the euro, its predecessor the exchange rate mechanism and the implications of leaving the EU, over a period of about 30 years,” he said.
“Unless these lessons are learned and acknowledged by economists, their historic mistakes will be repeated.”
Mr Martin has consistently rubbished warnings that Wetherspoons could come pressure from post-Brexit economic jitters and revealed modestly better-than-expected sales in the company’s latest trading update.
Wetherspoons’ like-for-like sales increased by 3.2pc for the three months to mid-January and by 3.4pc over the previous six months when compared to the year before. The chain expects its operating margin for the half year ending January 22 to be around 8pc, 1.7pc higher than the same period last year.
Shares in the pub chain climbed over 2.5pc to 926p as a result.
Mr Martin said he expected the company’s full-year sales to beat expectations, even as the pub sector faces rising costs this year.
Mr Martin said that government taxes would cause pubs to hike the price of food and drink this year but that Wetherspoons would keep its prices competitive.
“It’s inevitable that prices will rise within the sector because costs are going up. But that’s not because of the weaker pound but because of business rates, which are a tax, as well as increased wage costs.
“We’d like to see more tax equality with supermarkets – which have much lower rates than pubs – so we’ll be bending [Chancellor] Philip Hammond’s ear on that this year,” he added.
Wetherspoons will face a 4pc increase in wages this year after the introduction of the National Living Wage, a rise of £7m for business rates, and £2m for the Apprenticeship Levy, in addition to cost increases at around the level of inflation in other areas.
It plans to boost investment in existing pubs from £34m in 2015-6 to around £60m in the current year.
Mr Martin’s latest outburst follows a thinly veiled warning earlier this year that the pub chain could cut ties with continental suppliers and stop serving European drinks in its pubs, if EU leaders “bully” the UK into an unfavourable trade agreement as part of Brexit negotiations.
The chairman said the Government must be willing to walk away from a bad deal.
“Most people now understand that the mutual imposition of World Trade Organisation (WTO) tariffs would create a windfall for the UK, so a sensible basic mantra for the UK is ‘free trade or World Trade Organisation rules – the EU can choose’,” he said.