Wetherspoon, Marston’s and Young’s manage to fend off UK pubs crisis – for now
Some of the UK’s biggest pub chains – JD Wetherspoon, Marston’s and Young’s – have all proved surprisingly resilient in avoiding the hospitality crisis predicted last Autumn.
The London-listed companies have all reported better-than-expected trading over the last year, despite very low business and consumer confidence.
In an update to markets this morning, Marston’s reported a 20 per cent increase in operating profit and a 2.5 per cent improvement in its earnings before interest, tax, depreciation and amortisation (EBITDA) margin.
The pub owner said data and technology-led improvements in labour and procuring goods had driven the EBITDA change.
JD Wetherspoon, too, told markets like-for-like sales have increased 4.2 per cent since the start of 2025.
In the year ended March 2024, Young’s increased revenue by 25.4 per cent, with like-for-like sales up 5.7 per cent.
Heineken recently announced a £40m investment in 608 pubs, describing the money as a “vote of confidence for the great British local”. The giant also invested the same amount in 2024.
It’s a far cry from the language normally used to describe the state of British pubs: “crisis”, “doom-loop”, and “final nail in the coffin” tend to come up more often.
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The calm before the storm?
It’s possible that the recent spate of excellent trading for British pubs is a pre-cliff edge illusion, with higher hiring costs – as of 6 April – set to eat into money needed for hiring and investment.
JD Wetherspoon, for example, said it expects a “reasonable” outcome for the year despite the strong tick-up in sales.
“Its choice of language doesn’t suggest it is standing on the pub table, holding a pint aloft in celebration of strong takings at the bar,” AJ BEll analyst Russ Mould said.
“Saying it expects a ‘reasonable’ outcome for the financial year is like someone gritting their teeth with a fake smile and raised eyebrows – trying to give the impression everything is ok, but knowing there is a danger of sinking into quicksand,” he added.
Pubs have reason to be cautious: wage and tax increases have created an eye-watering £1.2m bill for JD Wetherspoon every week, something replicated – mostly to a lesser extent – industry-wide.
“Many venues are still paying back Covid loans and have been suffering under high interest rates, as well as cotinuing to grapple with the £3.4bn in additional annual cost that was placed upon them last month,” Kate Nicholls, chief executive of UKHospitality, said.
Business rates, too, are a bugbear of the industry, with rates relief set to drop from 75 per cent to 40 per cent
Brits are still picking pubs
Chief executives invariably describe the hospitality environment as “pressured”, “difficult” or “challenging” but in the vast majority of cases this is followed by cautious optimism that the sector will persist.
“Even with pressures on disposable income, people are still prioritising a trip to their local, valuing it as an everyday treat and as a way of connecting with their community,” managing director of Star Pubs, Lawson Mountsteven, said.
Roseacre Pub Company’s owner Ash Gartshore added: “Mid-market dining has proved a sweet spot attracting people trading up for a more premium experience and others, who previously frequented restaurants or gastro pubs, looking for a more affordable alternative.”
Robbie Morgan – owner of The Schooner, in Amble – said that pubs “which attract both locals and visitors” are “more resilient” in tough times, as well as those that offer good food.
Wages are in most cases still going up, and Brits are still more than happy to spend the extra money on hospitality – pubs spending rose 6.6 per cent in April, according to Barclays.
“Despite the ongoing pressures in the hospitality sector, it is clear that pub goers are still finding the time and money to enjoy a drink in the sunshine,” Julie Palmer, Partner at Begbies Traynor, said.
As long as pub culture is alive and well in the UK, it seems the boozers will stay standing.