The boss of JD Wetherspoon says that a Brexit without agreement will lead to lower prices | Business

JD Wetherspoon chairman Tim Martin said tariff plans without a Brexit deal would lead to lower prices for consumers, with higher staff compensation cutting profits for the coffee chain.

Martin was one of the most outspoken proponents of leaving the EU without an agreement, which means that trade would by default be in line with the terms of the World Trade Organization.

The government on Wednesday revealed its intention to zero tariffs on 87% of UK imports in the absence of agreement, but these plans would also increase tariffs on meat imported from the United States. ; EU. This could have an impact on Wetherspoon's food sales, which accounted for 36% of the turnover of its 879 cafés in the UK in the 26 weeks to January 27, according to Friday's results.

"If there is no agreement and we apply the tariff list proposed by the government, I think the prices will be lower than they would have been otherwise in Wetherspoon and elsewhere, "said Martin, highlighting possible tariff cuts on oranges, bananas and wines, including New Zealand Sauvignon Blanc and Australian Merlot.

Martin stands out in the hospitality industry by pushing for a Brexit without agreement. UKHospitality, an industry lobby, said this week that tariffs would raise prices for businesses and consumers, and has repeatedly warned that a Brexit without an agreement would be a serious disruption factor for the sector.

Martin said: "I think it will have a positive impact on our direct costs, but I also think that if you remove tariffs and quotas, I think it gives a message to foreign companies that you are open to business. . "

Wetherspoon reported lower profits for the period. Profit before tax decreased by 19% from the same period last year to £ 50.3 million, as staff costs increased by £ 33 million.

The increase in wages is due to the historically low unemployment rate, which has resulted in increased wages for new and existing employees, Martin said. The company faced a strike action by its employees to get a better salary.

Despite lower earnings, revenues grew by 7.1% to nearly £ 890 million and like-for-like sales increased by 6.3%.

Wetherspoon's investments in existing and new pubs have been declining year by year, which Martin says was driven by higher spending on new coffee machines and pizza ovens a year ago. However, the total investment was boosted by £ 55.7 million for the acquisition of freehold properties on properties for which Wetherspoon was previously a tenant.

Martin said that Wetherspoon would increase spending for new pubs over the next year, as well as add terraces and hotel rooms to its existing estate.

Trade since January has been boosted by the milder climate and by comparison with last year's weaker earnings, when the storm "the Eastern Beast" weighed on consumer spending. However, costs in the second half of the year will be higher, Wetherspoon said.