January 22, 2014 / 7:40 AM / in 4 years

Pub chain Wetherspoons posts strong Christmas sales rise

LONDON, Jan 22 (Reuters) - British pub chain JD Wetherspoon said preparations for expansion would keep margins under pressure this year as it reported accelerating sales growth in its second quarter.

The firm, which has grown to over 880 pubs on the back of popular value-led food and drinks deals, said on Wednesday sales at pubs open over a year rose 6.7 percent in the first 12 weeks of its second quarter to Jan. 19, up from a 3.7 percent first-quarter rise.

Total sales including new pubs rose 10.6 percent.

Wetherspoon said its operating margin had fallen 20 basis points to 8.1 percent in the period, due to investment in areas such as IT, training and staff as it extends its food offering and prepares to open more pubs.

Operating margin for the full-year was now expected to be between 8.1 and 8.3 percent, the firm said, having previously guided to 8.3 percent. The margin was 8.7 percent in 2012-13.

In November Wetherspoon increased its guidance for new pub openings for the 2013-14 financial year from 30 to between 40 and 50 due to a number of recent acquisitions.

The firm, which opened its first motorway services pub on Tuesday off the M40 in Beaconsfield, south east England, also plans to open its first pubs in Ireland in 2014.

Shares in the firm closed at 789 pence on Tuesday, up 58 percent on a year ago, valuing the business at almost 990 million pounds ($1.63 billion).

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