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FINANCIAL HIGHLIGHTS

J D Wetherspoon plc
ANNUAL REPORT AND FINANCIAL STATEMENTS 2022

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 1

Wetherspoon owns Contents

and operates pubs SECTION 1

throughout the UK 1 Chairman’s statement

and Ireland. The 11

11
Income statement
Statement of comprehensive income
company aims to 12 Cash flow statement
provide customers 13 Balance sheet

with good-quality 14
15
Statement of changes in equity
Notes to the financial statements
food and drinks,
served by well-trained SECTION 2
and friendly staff, at 43 Accounting policies

reasonable prices. 49 Strategic report

54 Task Force on Climate-related Financial
Disclosures (TCFD)

The pubs are 55 Independent auditors’ report

65 Directors and officers
individually designed, 66 Directors’ report

and the company aims 69

78
Directors’ remuneration report
Corporate governance
to maintain them in 85 Information for shareholders
86 Pubs opened and closed during the
excellent condition. financial year
87 Company information
88 Glossary

Financial calendar

Year end
30 July 2023

Preliminary announcement for 2023

October 2023

Interim report for 2023

March 2023

Annual general meeting

17 November 2022

View this report online:

jdwetherspoon.com/investors-home
CHAIRMAN’S STATEMENT SECTION 1
Financial performance

The company was founded in 1979 – and this is the 39th year since incorporation in 1983.
The table below outlines some key aspects of our performance during that period.

Summary accounts for the years 1984-2022

Profit/(loss) Earnings per
Total number before tax and share before Free cash flow
Total sales
of Pubs exceptional items exceptional items Free cash flow per share
Financial year £000
(Sites) £000 pence £000 pence
1984 1 818 (7) 0
1985 2 1,890 185 0.2
1986 2 2,197 219 0.2
1987 5 3,357 382 0.3
1988 6 3,709 248 0.3
1989 9 5,584 789 0.6 915 0.4
1990 19 7,047 603 0.4 732 0.4
1991 31 13,192 1,098 0.8 1,236 0.6
1992 45 21,380 2,020 1.9 3,563 2.1
1993 67 30,800 4,171 3.3 5,079 3.9
1994 87 46,600 6,477 3.6 5,837 3.6
1995 110 68,536 9,713 4.9 13,495 7.4
1996 146 100,480 15,200 7.8 20,968 11.2
1997 194 139,444 17,566 8.7 28,027 14.4
1998 252 188,515 20,165 9.9 28,448 14.5
1999 327 269,699 26,214 12.9 40,088 20.3
2000 428 369,628 36,052 11.8 49,296 24.2
2001 522 483,968 44,317 14.2 61,197 29.1
2002 608 601,295 53,568 16.6 71,370 33.5
2003 635 730,913 56,139 17.0 83,097 38.8
2004 643 787,126 54,074 17.7 73,477 36.7
20054 655 809,861 47,177 16.9 68,774 37.1
2006 657 847,516 58,388 24.1 69,712 42.1
2007 671 888,473 62,024 28.1 52,379 35.6
2008 694 907,500 58,228 27.6 71,411 50.6
2009 731 955,119 66,155 32.6 99,494 71.7
2010 775 996,327 71,015 36.0 71,344 52.9
2011 823 1,072,014 66,781 34.1 78,818 57.7
2012 860 1,197,129 72,363 39.8 91,542 70.4
2013 886 1,280,929 76,943 44.8 65,349 51.8
2014 927 1,409,333 79,362 47.0 92,850 74.1
2015 951 1,513,923 77,798 47.0 109,778 89.8
2016 926 1,595,197 80,610 48.3 90,485 76.7
2017 895 1,660,750 102,830 69.2 107,936 97.0
2018 883 1,693,818 107,249 79.2 93,357 88.4
2019 879 1,818,793 102,459 75.5 96,998 92.0
20206 872 1,262,048 (44,687) (35.5) (58,852) (54.2)
2021 861 772,555 (154,676) (119.2) (83,284) (67.8)
3
2022 852 1,740,477 (30,448) (19.6) 21,922 17.3
Notes 4. Before 2005, the accounts were prepared under UKGAAP.
Adjustments to statutory numbers All accounts from 2005 to date have been prepared under IFRS.
1. Where appropriate, the earnings/losses per share (EPS), as disclosed in the 5. Apart from the items in notes 1–4, all numbers are as reported in
statutory accounts, have been recalculated to take account of share splits, each year’s published accounts.
the issue of new shares and capitalisation issues. 6. From financial year 2020 data is based on post-IFRS 16 numbers following
2. Free cash flow per share excludes dividends paid which were included the transition from IAS17 to IFRS 16.
in the free cash flow calculations in the annual report and accounts for 7. Free cash flow is defined in the APM section within accounting policies on
the years 1995–2000. page 48. The calculation of free cash flow can be found on the cash flow
3. The weighted average number of shares, EPS and free cash flow per statement.
share include those shares held in trust for employee share schemes for all
years prior to 2022.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 1

CHAIRMAN’S STATEMENT

Background
Two equity issues during the pandemic were, of
To coin a Shakespeare phrase, “the multiplying course, key factors in this strengthening of the
villainies of nature do swarm upon” the hospitality balance sheet.
industry, following the lockdowns and restrictions of
the pandemic - and surprisingly perhaps, the On an IFRS 16 basis, which includes notional debt
aftermath has been just as difficult for many from leases, debt decreased from £1.45 billion to
companies. £1.29 billion between January 2020 and the end of
FY22.
Most commentators, including most publicans,
understandably predicted a post-lockdown boom, in In this context, Wetherspoon has, as reported
which the public would react to enforced cabin fever below, fixed £770 million of its debt until November
by embarking on a celebratory spree, but the reality 2031, at an average of 1.24%, excluding the banks’
has, in contrast, been a painstakingly slow recovery margin, a significant benefit at a time of rising
in sales, for some but not all, accompanied by great interest rates.
inflation in costs.
Fortunately, the company was able to extend these
A possible reason for the much slower-than- swaps by 32 months in the first half of FY22 - before
anticipated recovery has been an underestimation sharply rising inflation and interest rates were
of the power of habit in determining human anticipated by the market.
behaviour.
The mark-to-market value of these swaps was
During lockdown, dyed-in-the-wool pub-goers, many £182.7 million, as of 2 October 2022.
for the first time, filled their fridges with supermarket
Trading Summary
beer - and it has proved to be a momentous
challenge to persuade them to return to the more In the summary below we have compared sales and
salubrious environment of the saloon bar. profits with FY19, but cash flow, debt and other
areas are compared with FY21. To try to avoid
Even so, Wetherspoon’s trading performance in
confusion, we also provide a table, below, showing
FY22 improved versus the annus horribilis of FY21,
some key indicators referred to in this section of the
but was still markedly adverse to pre-pandemic
annual report, for the last four financial years.
FY19.
Total sales for FY22 were £1,740.5 million, a
Although like-for-like sales decreased by 4.7%
decrease of 4.3%, compared to the pre-pandemic
compared to FY19, sales trends improved in the
52 weeks ended 28 July 2019.
financial year. In the first half, like-for-like sales were
-7.4%; in the third quarter they were -4.0% and in Like-for-like sales, as indicated above, compared to
the fourth quarter they were -0.6%. FY19, decreased by 4.7%. Like-for-like bar sales
decreased by 6.5% and food sales by 3.2%.
Like-for-like sales have improved in the first 9 weeks
Slot/fruit machine sales increased by 12.3% and
of the current financial year (FY23) and are 10.1%
hotel room sales increased by 6.5%.
ahead of the first 9 weeks of FY22.
The operating profit, before exceptional items, was
In addition to the slowly improving sales trend, there
£25.7 million (2019: £131.9 million). The operating
was a significant turnaround of £105 million in free
margin, before exceptional items, was 1.5% (2019:
cashflow, which improved to an inflow of £21.9
7.3%).
million in FY22 compared to an outflow of £83.3
million in FY21. The loss before tax and exceptional items was
£30.4 million (2019: £102.5 million profit). This
Perhaps surprisingly, the Wetherspoon balance
included property gains of £2.1 million (2019: £5.6
sheet is also stronger than before the pandemic, at
million).
the expense of some dilution to pre-pandemic
shareholders. The company sold, closed, or terminated the leases
of 15 pubs, giving rise to a cash inflow of £5.9
Debt levels, combined with trade creditors
million.
(excluding notional IFRS 16 lease debt), have
increased by £53 million since January 2020, just Losses per share, including shares held in trust by
before the first lockdown, substantially less than a the employee share scheme, before exceptional
total of £158.3 million invested in freehold items, were 19.6p (2019: earnings per share of
“reversions” and new pubs during the period. 75.5p).

Since January 2020, £70.5 million has been spent

Total capital investment was £127.3 million (2021:
on freehold reversions (where Wetherspoon was
£62.7 million). £58.8 million was invested in new
previously the tenant) and £87.8 million on new
pubs and pub extensions (2021: £24.1 million),
pubs.
2 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC
 CHAIRMAN’S STATEMENT

£42.8 million in existing pubs and IT (2021: £20.0 £12.8 million for share purchases for employees
million) and £25.8 million in freehold reversions of (2021: £7.7 million) and payments of tax and
properties where Wetherspoon was the tenant interest. Free cash inflow per share was 17.3p
(2021: £16.9 million). (2021: 67.8p outflow).

The company continued to increase investment Dividends and return of capital

levels, on the basis that the adverse effects of
The board has not recommended the payment of a
Covid-19 would eventually diminish.
final dividend (2021: £0). There have been no share
IFRS 16 ‘Leases’ replaced IAS 17 ‘Leases’ for buybacks in the financial year to date (2021: £0).
accounting periods beginning on or after 1 January Financing
2019. IFRS 16 was adopted by the Company on 29
July 2019 using the ‘modified retrospective As at 31 July 2022, the company’s total net debt,
approach’. excluding derivatives and lease liabilities, was
£891.6 million (2021: £845.5 million), an increase of
Sales, profits and cash flow FY19 to FY22 £46.1 million.

The company has an agreement in place with its

FY22 FY21 FY20 FY19
lenders which waives debt covenants until October
Total sales
2023 and replaces them with a minimum liquidity
excluding 1,740.5 772.6 1,262.0 1,818.8
VAT (£m) requirement of £100 million in the first half of FY23,
followed by relaxed leverage covenants in the
Like-for-like
sales vs 29.9% -38.4% -29.5% 6.8% second half of the year.
prior year
There has been no change in the total available
Operating
finance facilities of £1,083.0 million during the
profit/(loss)
before 25.7 -100.4 17.0 131.9 period.
exceptional
items (£m) During the year, as reported above, the company
has extended the period of its interest rate swaps, in
Profit/(loss)
before tax
respect of £770 million, from March 2029 to
and -30.4 -167.2 -44.7 102.5 November 2031. The swap rate currently being
exceptional paid, excluding the banks’ margin, is 1.61%. The
items (£m) total cost of the company’s debt, in the year under
Free cash review, including the banks’ margin was 4.46%. The
21.9 -83.3 -58.9 97.0
flow (£m) cost of the swaps is illustrated in the table below:

Exceptional items
Swap Weighted
Start Date End Date
There was a pre-tax exceptional gain of £56.7 Value Average %
million (2021: £27.5 million loss).
£770m 30-Jul-21 30-Jul-23 1.61%
£52.9 million of the gain related to the fair value
movement of interest rate swaps, which the £770m 31-Jul-23 30-Jul-26 1.10%
company has in place for approximately the next 9
£770m 31-Jul-26 30-Jun-28 1.33%
years, as reported above, at an average rate of
1.24%, excluding the banks’ margin. In addition, £770m 01-Jul-28 29-Mar-29 1.32%
there was a gain of £27.8 million in relation to an
£770m 31-Mar-29 30-Nov-31 1.02%
HMRC claim, regarding the historic VAT treatment
of slot/fruit machines. There was also a gain of £1.4
million in respect of government support grants, Property
associated with the pandemic. Finally, there was a The company opened seven pubs during the year
£24.4 million property impairment charge, in respect and sold, closed or terminated the leases of 15
of pubs which were deemed unlikely to generate pubs. The company had a trading estate of 852
sufficient cash flows, in the future, to support their pubs at the financial year end.
carrying value.
The company is currently marketing 32 pubs, most
Free Cash Flow of which are within a close radius of other pubs we
own. The strategy of opening larger pubs, at a
There was a free cash inflow of £21.9 million (2021:
considerable distance from each other, reflects a
£83.3 million outflow), after capital payments of
long-term strategy, rather than a reaction to trading
£45.9 million for existing pubs (2021: £22.3 million),
difficulties in the Covid era, as some commentators
have incorrectly said.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 3

CHAIRMAN’S STATEMENT

The full-year depreciation charge, excluding Scotland Business Rates

depreciation of “right-of-use” assets (a new charge
Business rates are supposed to be based on the
to the profit and loss account, post-IFRS 16) was
value of the building, rather than the level of trade of
£74.6 million (2021: £76.4 million).
the tenant. This should mean that the rateable value
The company has increased the percentage of per square foot is approximately the same for
freehold pubs it owns in the last 11 years. comparable pubs in similar locations. However, as a
result of the valuation approach adopted by the
As at 24 July 2011, the company’s freehold/
government “Assessor” in Scotland, Wetherspoon
leasehold ratio was 43.4%/56.6%. As at 31 July
often pays far higher rates per square foot than its
2022, as a result of investment in freehold
competitors.
reversions and freehold pub openings, the ratio was
68.8%/31.2%. This is highlighted (in the tables below) by
assessments for the Omni Centre, a modern leisure
As at 31 July 2022, the net book value of the
complex in central Edinburgh, where Wetherspoon
property, plant and equipment of the company was
has been assessed at more than double the rate per
£1.4 billion, including £1.1 billion of freehold and
square foot of the average of its competitors, and for
long-leasehold property.
The Centre in Livingston (West Lothian), a modern
The properties have not been revalued since 1999. shopping centre, where a similar anomaly applies.

Taxation As a result of applying valuation practice from

another era, which assumed that pubs charged
The current corporation tax charge for the year is approximately the same prices, the raison d’être of
£7.0 million (2021: £17.6 million credit). The the rating system - that rates are based on property
‘accounting’ tax credit, which appears in the income values, not the tenants trade- has been undermined.
statement, is £5.6 million (2021: £20.7 million
credit). Similar issues are evident in Galashiels, Arbroath,
Wick, Anniesland - and indeed most Wetherspoon
The accounting tax credit comprises two parts: the pubs in Scotland. In effect, the application of the
actual current tax credit (the ‘cash’ tax) and the rating system in Scotland discriminates against
deferred tax credit (the ‘accounting’ tax). The tax businesses like Wetherspoon, which have lower
losses arising in the financial year will be carried prices, and encourages businesses to charge higher
forward for use against profits in future years, prices. As a result, consumers are likely to pay
meaning that the cash tax benefit will be received in higher prices, which cannot be the intent of rating
future years. Therefore, a ‘deferred tax’ benefit is legislation.
created which will reverse in future years when the
cash tax benefit of the losses is realised.
Omni Centre, Edinburgh
The company is seeking a refund of historic excise Rateable Customer
Rates per
Occupier Name square
duty from HMRC, totalling £524k, in relation to Value (RV) Area (ft²)
foot
goods sent to the Republic of Ireland, when Playfair (JDW) £218,750 2,756 £79.37
Wetherspoon pubs first opened in that country. The
Unit 9 (vacant) £48,900 1,053 £46.44
company has been charged excise duty on the
same goods twice, as they were purchased in the Unit 7 (vacant) £81,800 2,283 £35.83
UK, and excise duty was paid in full. Irish excise Frankie & Benny's £119,500 2,731 £43.76
duty was then paid in addition.
Nando's £122,750 2,804 £43.78
Owing to a paperwork error, in the early days of our Slug & Lettuce £108,750 3,197 £34.02
business in the Republic, which the company has
The Filling Station £147,750 3,375 £43.78
sought to rectify, it has, to date, been unable to
reclaim this duty, even though it is transparently Tony Macaroni £125,000 3,427 £36.48

clear that the duty has been paid. Unit 6 (vacant) £141,750 3,956 £35.83

Cosmo £200,000 7,395 £27.05

Average (exc JDW) £121,800 3,358 £38.55

4 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 CHAIRMAN’S STATEMENT

The Centre, Livingston important there – people can less afford to pay the
Rates per difference in prices between the on and off trade.
Rateable Customer
Occupier Name square
Value (RV) Area (ft²)
foot As a result, in these less affluent areas, there are
The Newyearfield
(JDW)
£165,750 4,090 £40.53 often fewer pubs, coffee shops and restaurants, with
Paraffin Lamp £52,200 2,077 £25.13
less employment and increased high-street
derelication. Tax equality would also be in line with
Wagamana £67,600 2,096 £32.25
the principle of fairness – the same taxes should
Nando’s £80,700 2,196 £36.75 apply to businesses which sell the same products.
Chiquito £68,500 2,221 £30.84

Ask Italian £69,600 2,254 £30.88

Pizza Express £68,100 2,325 £29.29

Prezzo £70,600 2,413 £29.26

Harvester £98,600 3,171 £31.09

Pizza Hut £111,000 3,796 £29.24

Hot Flame £136,500 4,661 £29.29

Average (exc JDW) £82,340 2,721 £30.40

VAT equality

As we have previously stated, the government

would generate more revenue and jobs if it were to
create tax equality among supermarkets, pubs and
restaurants. Supermarkets pay virtually no VAT in
respect of food sales, whereas pubs pay 20%. This
has enabled supermarkets to subsidise the price of
alcoholic drinks, widening the price gap, to the
detriment of pubs and restaurants. Pubs also pay
around 20 pence a pint in business rates, whereas
supermarkets pay only about 2 pence, creating
further inequality.

Pubs have lost 50% of their beer sales to

supermarkets in the last 35 or so years. It makes no
sense for supermarkets to be treated more leniently
than pubs, since pubs generate far more jobs per
pint or meal than do supermarkets, as well as far
higher levels of tax. Pubs also make an important
contribution to the social life of many communities
and have better visibility and control of those who
consume alcoholic drinks.

Tax equality is particularly important for residents of

less affluent areas, since the tax differential is more

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 5

CHAIRMAN’S STATEMENT

How pubs contribute to the economy In the financial year ended 31 July 2022, the
company generated taxes of £662.7 million.
Wetherspoon and other pub and restaurant
companies have always generated far more in taxes The table below shows the £5.8 billion of tax
than are earned in profits. Wetherspoon, it’s revenue generated by the company, its staff and
customers and staff, generated total taxes in FY19, customers in the last 10 years. Each pub, on
before the pandemic, of £763.6 million. This average, generated £6.5 million in tax during that
equated to one pound in every thousand of UK period. The tax generated by the company, during
government revenue. this 10-year period, equates to approximately 20
times the company’s profits after tax.
TOTAL
2022 2021 2020 2019 2018 2017 2016 2015 2014 2013 2013 to
2022
£m £m £m £m £m £m £m £m £m £m £m

VAT 287.7 93.8 244.3 357.9 332.8 323.4 311.7 294.4 275.1 253.0 2,774.1

Alcohol duty 156.6 70.6 124.2 174.4 175.9 167.2 164.4 161.4 157.0 144.4 1,496.1

PAYE and NIC 141.9 101.5 106.6 121.4 109.2 96.2 95.1 84.8 78.4 70.2 1,005.3

Business rates 50.3 1.5 39.5 57.3 55.6 53.0 50.2 48.7 44.9 46.4 447.4

Corporation tax 1.5 - 21.5 19.9 26.1 20.7 19.9 15.3 18.4 18.4 161.7

Corporation tax
credit (historic
- - - - - - - -2.0 - - -2.0
capital
allowances)
Fruit/slot
12.8 4.3 9.0 11.6 10.5 10.5 11 11.2 11.3 7.2 99.4
Machine duty
Climate change
9.7 7.9 10.0 9.6 9.2 9.7 8.7 6.4 6.3 4.3 81.8
levies
Stamp duty 2.7 1.8 4.9 3.7 1.2 5.1 2.6 1.8 2.1 1.0 26.9

Sugar tax 2.9 1.3 2.0 2.9 0.8 - - - - - 9.9

Fuel duty 1.9 1.1 1.7 2.2 2.1 2.1 2.1 2.9 2.1 2.0 20.2

Carbon tax - - - 1.9 3.0 3.4 3.6 3.7 2.7 2.6 20.9

Premise licence
0.5 0.5 1.1 0.8 0.7 0.8 0.8 1.6 0.7 0.7 8.2
and TV licences

Landfill tax - - - - 1.7 2.5 2.2 2.2 1.5 1.3 11.4

Employee
-4.4 -213.0 -124.1 - - - - - - - -341.5
support grants

Eat out to help

- -23.2 - - - - - - - - -23.2
out

Local
Government -1.4 -11.1 - - - - - - - - -12.5
Grants
TOTAL TAX 662.7 37.0 440.7 763.6 728.8 694.6 672.3 632.4 600.5 551.5 5,784.1

TAX PER PUB 0.78 0.04 0.53 0.87 0.83 0.77 0.71 0.67 0.66 0.63 6.49
TAX AS % OF
38.1% 4.8% 34.9% 42.0% 43.0% 41.8% 42.1% 41.8% 42.6% 43.1% 37.4%
NET SALES
LOSS/PROFIT
-24.9 -146.5 -38.5 79.6 83.6 76.9 56.9 57.5 58.9 65.2 268.7
AFTER TAX
Note – this table is prepared on a cash basis.
IFRS 16 was implemented in the year ending 26 July 2020 (FY20). From this period all profit numbers in the above table are on
a Post-IFRS 16 basis. Prior to this date all profit numbers are on a Pre-IFRS 16 basis.

6 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 CHAIRMAN’S STATEMENT

Corporate Governance
As a result, it appears that compliance officers and
Wetherspoon has been a strong critic of the governance advisors, in practice, often rely on a
composition of the boards of UK-quoted companies. “tick-box” approach, which is, itself, in breach of the
Code.
As a result of the “nine-year rule”, limiting the tenure
of NEDs and the presumption in favour of A further issue is that many major investors, in their
“independent”, part-time chairmen, boards are often own companies, for sensible reasons, do not
composed of short-term directors, with very little observe the nine-year rule, and other rules,
representation from those who understand the themselves. An approach of “do what I say, not
company best - people who work for it full-time, or what I do” is clearly unsustainable.
have worked for it full-time.
Further progress
Wetherspoon’s review of the boards of major banks
As always, the company has tried to improve as
and pub companies, which teetered on the edge of
many areas of the business as possible, on a week-
failure in the 2008-2010 recession, highlighted the
to-week basis, rather than aiming for ‘big ideas’ or
short “tenure”, on average, of directors.
grand strategies.
In contrast, Wetherspoon noted the relative
Frequent calls on pubs by senior executives, the
success, during this fraught financial period, of pub
encouragement of criticism from pub staff and
companies Fuller’s and Young’s, the boards of
customers and the involvement of pub and area
which were dominated by experienced executives,
managers, among others, in weekly decisions, are
or former executives.
the keys to success.
As a result, Wetherspoon has increased the level of
Wetherspoon paid £30.1 million in respect of
experience on the Wetherspoon board by
bonuses and free shares to employees in the period
appointing four “worker directors”.
ended 31 July 2022, of which 98.8% was paid to
All four worker directors started on the “shop floor” staff below board level and 91.5% was paid to staff
and eventually became successful pub managers. working in our pubs.
Three have been promoted to regional management
Wetherspoon has been the biggest corporate
roles. They have worked for the company for an
sponsor of ‘Young Lives vs Cancer’ (previously CLIC
average of 24 years.
Sargent), having raised a total of £20.6 million since
Board composition cannot guarantee future 2002. During the pandemic, our contributions had
success, but it makes sensible decisions, based on been reduced, but since the reopening of our pubs
experience at the coalface of the business, more there have been great efforts seen and our
likely. contributions have bounced back significantly.

The UK Corporate Governance Code 2018 (the Bonuses and Free Shares
“Code”) is a vast improvement on previous codes,
As indicated above, Wetherspoon has, for many
emphasising the importance of employees,
years (see table below), operated a bonus and
customers and other stakeholders in commercial
share scheme for all employees. Before the
success. It also emphasises the importance of its
pandemic, these awards increased, as earnings
‘comply or explain’ ethos, and the consequent need
increased for shareholders.
for shareholders to engage with companies in order
to understand their explanations.

A major impediment to the effective implementation

of comply or explain seems to be the undermanning
of the corporate governance departments of major
shareholders.

For example, Wetherspoon has met a compliance

officer from one major institution who is responsible
for around 400 companies - an impossible task,
since the written regulatory output of each company
is vast, coupled with the practical impossibility of
meeting with so many companies in any meaningful
way.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 7

CHAIRMAN’S STATEMENT

Bonus and In the separate Scottish scheme, which records

Bonus
(Loss)/Profit free shares either a ‘pass’ or a ‘fail’, all of our 60 pubs have
and free
Financial after tax1 as % of
shares passed.
year profits
Pubs with
£m £m
Financial Total Pubs Average highest
2007 19 47 41% Year Scored Rating Rating %
2008 16 36 45% 2013 771 4.85 87.0
2009 21 45 45% 2014 824 4.91 92.0
2010 23 51 44% 2015 858 4.93 94.1
2011 23 52 43% 2016 836 4.89 91.7
2012 24 57 42% 2017 818 4.89 91.8
2013 29 65 44% 2018 807 4.97 97.3
2014 29 59 50% 2019 799 4.97 97.4
2015 31 57 53%
2020 781 4.96 97.0
2016 33 57 58%
2021 787 4.97 98.4
2017 44 77 57%
2022 775 4.98 98.6
2018 43 84 51%
2019 46 80 58%
2020 33 (39) - Property litigation
2021 23 (146) - As previously reported, Wetherspoon agreed on an
2022 30 (25) - out-of-court settlement with developer Anthony
Total 467 557 49.7%2 Lyons, formerly of property leisure agent Davis
Coffer Lyons, in 2013 and received approximately
1
(IFRS 16 was implemented in the year ending 26 July 2020 (FY20). From this
period all profit numbers in the above table are on a Post-IFRS 16 basis. Prior
£1.25 million from Mr Lyons.
to this date all profit numbers are on a Pre-IFRS 16 basis.
2
Excludes 2020, 2021 and 2022. The payment relates to litigation in which
Wetherspoon claimed that Mr Lyons had been an
Length of Service
accessory to frauds committed by Wetherspoon’s
The attraction and retention of talented pub and former retained agent Van de Berg and its directors
kitchen managers is important for any hospitality Christian Braun, George Aldridge and Richard
business. As the table below demonstrates, the Harvey. Mr Lyons denied the claim – and the
retention of managers has improved, even during the litigation was contested.
pandemic.
The claim related to properties in Portsmouth,
Leytonstone and Newbury. The Portsmouth
Average pub Average kitchen
Financial manager length manager length of property was involved in the 2008/9 Van de Berg
year of service service case itself.
(Years) (Years)
In that case, Mr Justice Peter Smith found that Van
2013 9.1 6.0
de Berg, but not Mr Lyons (who was not a party to
2014 10.0 6.1
the case), fraudulently diverted the freehold from
2015 10.1 6.1
Wetherspoon to Moorstown Properties Limited, a
2016 11.0 7.1
company owned by Simon Conway. Moorstown
2017 11.1 8.0 leased the premises to Wetherspoon. Wetherspoon
2018 12.0 8.1 is still a leaseholder of this property – a pub called
2019 12.2 8.1 The Isambard Kingdom Brunel.
2020 12.9 9.1
2021 13.6 9.6 The properties in Leytonstone and Newbury (the
2022 13.9 10.4 other properties in the case against Mr Lyons) were
not pleaded in the 2008/9 Van de Berg case.
Food Hygiene Ratings
Leytonstone was leased to Wetherspoon and trades
Wetherspoon has always emphasised the today as The Walnut Tree public house. Newbury
importance of hygiene standards. was leased to Pelican plc and became Café Rouge.
We now have 775 pubs rated on the Food As we have also reported, the company agreed to
Standards Agency’s website (see table below). The settle its final claim in this series of cases and
average score is 4.98, with 98.6% of the pubs accepted £400,000 from property investor Jason
achieving a top rating of five stars. We believe this Harris, formerly of First London and now of First
to be the highest average rating for any substantial
pub company.

8 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 CHAIRMAN’S STATEMENT
Urban Group. Wetherspoon alleged that Harris was Pubwatch has improved wider town and city
an accessory to frauds committed by Van de Berg. environments, by bringing together pubs, local
authorities and the police, in a concerted way, to
Harris contested the claim and has not admitted
encourage good behaviour and to reduce anti-social
liability.
activity.
Before the conclusion of the above cases,
Wetherspoon has been a long-standing supporter of
Wetherspoon also agreed on a settlement with Paul
local Pubwatch schemes and has helped to
Ferrari of London estate agent Ferrari Dewe & Co,
organise 16 new schemes in the last year.
in respect of properties referred to as the ‘Ferrari
Wetherspoon pubs are members of over 600
Five’ by Mr Justice Peter Smith.
schemes country wide. The company also helps to
Press corrections fund National Pubwatch, founded by just 2 licensees
and a police officer in 1997, which is the umbrella
The press and media have generally been fair and organisation that helps set up, coordinate and
accurate in reporting on Wetherspoon over the support local schemes.
decades. However, in the febrile atmosphere of the
first lockdown, something went awry and a number It is our experience that in some towns and cities,
of harmful inaccuracies were published. where the authorities have struggled to control anti-
social behaviour, the setting up of a Pubwatch has
In order to try and set the record straight, a special been instrumental in improving safety and security -
edition of Wetherspoon News was published, which not only of licensed premises, but also of the town
includes details of the resulting apologies and and city in general, as well as assisting the police in
corrections, which can be found on the Company’s bringing down crime.
website
Conversely, we have found that in a number of
(https://www.jdwetherspoon.com/~/media/files/pdf- towns, including some towns on the outskirts of
documents/wetherspoon-news/does-truth- London, that the absence of an effective Pubwatch
matter_.pdf ). scheme results in higher incidents of crime, disorder
Board changes and anti-social behaviour.

Su Cacioppo is retiring from the Wetherspoon board In our view, Pubwatch is integral to making towns
today, 7th October 2022, after 31 years with the and cities a safe environment for everyone.
company. Su started as a pub manager in 1991, Therefore, licensees, the police and local authorities
then became an area manager, before eventually throughout the land should give Pubwatch their full
becoming the board director responsible for the support.
personnel, legal and marketing departments in
2008. Current trading and outlook

Sir Richard Beckett KC is also retiring from the As reported above, in the first 9 weeks of the current
board at this year’s AGM, after 13 years as a non- financial year, to 2 October 2022, like-for-like sales
executive director of the company, latterly as head increased by 10.1%, compared to the 9 weeks to 3
of the nominations committee. October 2021.

I would like to thank sincerely Su and Richard for As we have also outlined above, the company has
their dedicated, creative and conscientious work improved its prospects in a number of ways in
over many years. recent financial years - we own an increasing
percentage of freehold properties; the balance sheet
Pubwatch has been strengthened; interest rates have been
Pubwatch is a forum where pubs in a town or city fixed at low levels until 2031; we have a large
can meet together regularly, often with a police contingent of long-serving pub staff and underlying
licensing officer, responsible for pubs in the area. sales are improving.

Local authorities sometimes attend and issues However, as a result of the previously reported
around maintaining good behaviour in pubs and in increases in labour and repair costs and the
the town or city generally are debated. potentially adverse effects of rises in interest rates
and energy costs on the economy, firm predictions
A wide range of initiatives is promoted, including are hard to make.
drink spiking awareness, town centre radio links,
vulnerability training and refusal of entry to all pubs Perhaps the biggest threat to the hospitality industry
in the area for customers who misbehave. is the possibility of further lockdowns and
restrictions.

Those interested in the UK government response to

the pandemic may like to read the reports by

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 9

CHAIRMAN’S STATEMENT

Professor Francois Balloux, director of the UCL that these plans were jettisoned, early on in the
Genetics Institute, in the Guardian, and by pandemic, in favour of copying China’s lockdown
Professor Robert Dingwall, of Trent University, in approach - an example, perhaps, of Warren
the Telegraph (see pages 54 to 56 of Wetherspoon Buffett’s so-called “institutional imperative” -
News “everyone else has locked down, so we will, too”.

The other major threat to the hospitality industry, as

https://www.jdwetherspoon.com/~/media/files/pdf-
reported above, is the huge and unjustifiable tax
documents/wetherspoon-news/wetherspoon-news-
advantage that supermarkets enjoy. The hospitality
autumn-2022.pdf ).
industry pays far higher levels of VAT and business
The conclusion of Professor Balloux, broadly rates than supermarkets. This competitive
echoed by Professor Dingwall, based on an analysis disadvantage has had an increasingly debilitating
by the World Health Organisation of the pandemic, impact on the hospitality industry and will
is that Sweden (which did not lock down), had a undoubtedly result in long-term financial weakness
Covid-19 fatality rate “of about half the UK’s” and vis a vis supermarkets - which will also be harmful to
that “the worst performer, by some margin, is Peru, employees, the Treasury and the overall economy.
despite enforcing the harshest, longest lockdown.”
These caveats aside, in the absence of further
Professor Balloux concludes that “the strength of lockdowns or restrictions, the company is cautiously
mitigation measures does not seem to be a optimistic, for the reasons we have outlined, about
particularly strong indicator of excess deaths.” future prospects.

Indeed, as some commentators have noted, Tim Martin

lockdowns were not contemplated in the UK’s Chairman
laboriously compiled pre-pandemic plans. It appears 6 October 2022

10 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

INCOME STATEMENT for the 53 weeks ended 31 July 2022

J D Wetherspoon plc, company

number: 1709784

53 weeks 53 weeks 53 weeks Restated1 Restated1

52 weeks
52 weeks 52 weeks
ended ended ended ended ended ended
31 July 31 July 31 July 25 July 25 July 25 July
Notes 2022 2022 2022 2021 2021 2021
Before Exceptional After Before Exceptional After
exceptional items exceptional exceptional items exceptional
items (note 4) items items (note 4) items
£000 £000 £000 £000 £000 £000
Revenue 1 1,740,477 - 1,740,477 772,555 - 772,555

Other operating income - 29,384 29,384 -

15,541 15,541
Operating costs (1,714,757) - (1,714,757) (872,913) (24,482) (897,395)
Operating profit/(loss) 2 25,720 29,384 55,104 (100,358) (8,941) (109,299)
Property gains/(losses) 3 2,142 (24,526) (22,384) (123) (5,839) (5,962)
Finance income 6 531 51,859 52,390 595 - 595
Finance costs 6 (58,841) - (58,841) (67,280) (12,690) (79,970)
(Loss)/profit before tax (30,448) 56,717 26,269 (167,166) (27,470) (194,636)
1
Income tax 7 5,560 (12,562) (7,002) 20,695 (3,065) 17,630
1
(Loss)/profit for the period (24,888) 44,155 19,267 (146,471) (30,535) (177,006)

(Loss)/earnings per ordinary share

(p)
- Basic1 8 (19.6) 34.8 15.2 (119.2) (24.9) (144.1)
1
- Diluted 8 (19.6) 34.8 15.2 (119.2) (24.9) (144.1)

1
Restated 25 July 2021. See Accounting policies page 48

STATEMENT OF COMPREHENSIVE INCOME for the 53 weeks ended 31 July 2022

Restated1
Notes 53 weeks
52 weeks
ended ended
31 July 25 July
2022 2021
£000 £000

Items which will be reclassified subsequently to profit or loss:

Interest-rate swaps: gain taken to other comprehensive income 22 48,452 44,551

Interest-rate swaps: (loss)/gain reclassification to the income statement 22 (4,332) 11,707

Tax on items taken directly to other comprehensive income1 7 (11,051) (9,133)

Currency translation losses (1,474) (3,510)

Net gain recognised directly in other comprehensive income1 31,595 43,615

Profit/(loss) for the period1 19,267 (177,006)

Total comprehensive profit/(loss) for the period 50,862 (133,391)

1
Restated 25 July 2021. See Accounting policies page 48

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 11

CASH FLOW STATEMENT for the 53 weeks ended 31 July 2022

J D Wetherspoon plc, company number: 1709784

1
Notes Free cash Free cash
flow flow
53 weeks 53 weeks 52 weeks 52 weeks
ended ended ended ended
31 July 31 July 25 July 25 July
2022 2022 2021 2021
£000 £000 £000 £000

Cash flows from operating activities

Cash generated from operations 9 178,510 178,510 25,208 25,208

Interest received 97 97 187 187

Interest paid (41,044) (41,044) (48,428) (48,428)

Corporation tax (paid)/received (715) (715) 7,673 7,673

Lease interest (17,501) (17,501) (19,942) (19,942)

Net cash flow from operating activities 119,347 119,347 (35,302) (35,302)

Cash flows from investing activities

Reinvestment in pubs (42,777) (42,777) (19,692) (19,692)

Reinvestment in business and IT projects (3,113) (3,113) (2,620) (2,620)

Investment in new pubs and pub extensions (51,083) – (21,131) –

Purchase of freeholds (25,773) – (16,858) –

Proceeds of sale of property, plant and equipment 10,547 – 2,575 –

Net cash flow from investing activities (112,199) (45,890) (57,726) (22,312)

Cash flows from financing activities

Purchase of own shares for share-based payments (12,808) (12,808) (7,684) (7,684)

Loan issue cost 10 (192) (192) (434) (434)

Advances/(repayments) under bank loans 10 50,000 – (195,000) –

Advances under CLBILS 10 – – 100,033 –

Other loan receivables 10 (3,542) – – –

Lease principal payments 23 (38,535) (38,535) (17,552) (17,552)

Issue of share capital 27 – – 91,523 –

Asset-financing principal payments 10 (7,132) – (6,901) –

Net cash flow from financing activities (12,209) (51,535) (36,015) (25,670)

Net change in cash and cash equivalents 10 (5,061) (129,043)

Opening cash and cash equivalents 18 45,408 174,451

Closing cash and cash equivalents 18 40,347 45,408

Free cash flow 21,922 (83,284)

1
Free cash flow is a measure not required by accounting standards; a definition is provided in the accounting policies.

12 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

BALANCE SHEET as at 31 July 2022
J D Wetherspoon plc, company number: 1709784
Restated1
Notes 31 July
25 July
2022 2021

£000 £000
Assets

Non-current assets
Property, plant and equipment 13 1,426,862 1,423,826
Intangible assets 12 5,409 5,358
Investment property 14 23,364 10,533
Right-of-use assets 23 419,416 468,538
Other loan receivable 16 2,739 -
Derivative financial instruments 22 61,367 -
Lease assets 23 9,264 9,890
Total non-current assets 1,948,421 1,918,145

Current assets
Lease assets 23 2,001 1,638
Assets held for sale 17 800 -
Inventories 15 26,402 26,853
Receivables 16 29,400 16,427
Current income tax receivables 2,000 1,187
Cash and cash equivalents 18 40,347 45,408
Total current assets 100,950 91,513
Total assets 2,049,371 2,009,658

Current liabilities
Borrowings 20 (5,137) (7,610)
Trade and other payables 19 (282,481) (259,791)
Provisions 21 (2,661) (3,004)
Lease liabilities 23 (48,471) (65,219)
Total current liabilities (338,750) (335,624)

Non-current liabilities
Borrowings 20 (930,404) (883,272)
Derivative financial instruments 22 (2,031) (37,643)
Deferred tax liabilities 7 (34,718) (16,546)
Lease liabilities 23 (421,583) (458,596)
Total non-current liabilities (1,388,736) (1,396,057)
Total liabilities (1,727,486) (1,731,681)
Net assets 321,885 277,977

Shareholders’ equity

Share capital 27 2,575 2,575

Share premium account 143,294 143,294
Capital redemption reserve 2,337 2,337
Other reserves 234,579 234,579
Hedging reserve1 22 13,617 (19,452)
Currency translation reserve (144) 1,851
Retained earnings1 (74,373) (87,207)
Total shareholders’ equity 321,885 277,977
1
Restated 25 July 2021. See Accounting policies page 48

The financial statements, on pages 11–42, approved by the board of directors and authorised for issue on 6 October 2022, are
signed on its behalf by:

John Hutson Ben Whitley

Director Director

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 13

STATEMENT OF CHANGES IN EQUITY
J D Wetherspoon plc, company
number: 1709784

Share
Notes Share Capital Other Restated1 Currency Restated1 Total1
premium
capital account redemption Reserves Hedging translation Retained
reserve reserve reserve earnings
£000 £000 £000 £000 £000 £000 £000 £000
At 26 July 2020 2,408 143,294 2,337 141,002 (66,577) 7,089 87,695 317,248
Total comprehensive income - - - - 47,125 (5,238) (175,278) (133,391)
Loss for the period1 - - - - - - (177,006) (177,006)
Interest-rate swaps: cash flow
22 - - - - 44,551 - - 44,551
hedges
Interest-rate swaps: amount
22 - - - - 11,707 - - 11,707
reclassified to the income statement
Tax on items taken directly to
7 - - - - (9,133) - - (9,133)
comprehensive income1
Currency translation differences - - - - - (5,238) 1,728 (3,510)

Issued share capital (net of

167 - - 93,577 - - (2,221) 91,523
expenses)
Share-based payment charges - - - - - - 10,267 10,267
Tax on share-based payment - - - - - - 14 14
Purchase of own shares for share-
- - - - - - (7,684) (7,684)
based payments

As at 25 July 2021 as previously

2,575 143,294 2,337 234,579 (15,403) 1,851 (91,256) 277,977
reported
Effect of restatment1 - - - (4,049) - 4,049 -
Restated1 At 25 July 2021 2,575 143,294 2,337 234,579 (19,452) 1,851 (87,207) 277,977
Total comprehensive income - - - - 33,069 (1,995) 19,788 50,862
Profit for the period - - - - - - 19,267 19,267
Interest-rate swaps: cash flow
22 - - - - 48,452 - - 48,452
hedges
Interest-rate swaps: amount
22 - - - - (4,332) - - (4,332)
reclassified to the income statement
Tax on items taken directly to
7 - - - - (11,051) - - (11,051)
comprehensive income
Currency translation differences - - - - - (1,995) 521 (1,474)

Share-based payment charges - - - - - - 5,874 5,874

Tax on share-based payment - - - - - - (20) (20)
Purchase of own shares for share-
- - - - - - (12,808) (12,808)
based payments
At 31 July 2022 2,575 143,294 2,337 234,579 13,617 (144) (74,373) 321,885
1
Restated 25 July 2021. See Accounting policies page 48

The currency translation reserve contains the accumulated currency gains and losses on the long-term financing and balance
sheet translation of the overseas branch. The currency translation difference reported in retained earnings is the retranslation of
the opening reserves in the overseas branch at the current period end’s currency exchange rate.

As at 31 July 2022, the company had distributable reserves of £173.7m (2021: £129.8m).

14 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

NOTES TO THE FINANCIAL STATEMENTS
1. Revenue

` 53 weeks 52 weeks
ended ended
31 July 25 July
2022 2021
£000 £000

Bar 1,024,677 440,119

Food 639,683 283,192
Eat out to help out scheme (note 24) - 23,248
Slot/fruit machines 51,639 17,059
Hotel 22,848 8,592
Other 1,630 345
1,740,477 772,555

2. Operating profit/(loss) – analysis of costs by nature

This is stated after charging/(crediting): 53 weeks 52 weeks

ended ended
31 July 25 July
2022 2021
£000 £000

Variable concession rental payments (note 23) 8,799 2,801

Short-term leases (note 23) 10 784
Cancelled principal payments (note 23) (4,726) (10,933)
Repairs and maintenance 101,520 64,020
Net rent receivable (2,001) (1,873)
Share-based payments (note 5) 5,874 10,267
Depreciation of property, plant and equipment (note 13) 71,227 73,193
Amortisation of intangible assets (note 12) 3,240 3,151
Depreciation of investment properties (note 14) 87 44
Depreciation of right-of-use assets (note 23) 42,291 44,532

Analysis of continuing operations 53 weeks 52 weeks

ended ended
31 July 25 July
2022 2021
£000 £000
Revenue 1,740,477 772,555
Cost of sales1 (1,640,202) (844,574)
Gross profit/(loss) 100,275 (72,019)
Administration costs (45,171) (37,280)
Operating profit/(loss) after exceptional items 55,104 (109,299)

53 weeks 52 weeks
Auditor’s remuneration
ended ended
31 July 25 July
2022 2021
£000 £000
Fees payable for the audit of the financial statements
– Audit fees 415 303
– Additional audit work (for previous year audit) 85 100

Fees payable for other services:

– Audit related services (interim audit procedures) 55 33
Total auditor’s fees 555 436
1
Included in cost of sales is £599.8m (2021: £272.8m) relating to cost of inventory recognised as expense.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 15

NOTES TO THE FINANCIAL STATEMENTS

3. Property losses and gains

53 weeks 53 weeks 53 weeks 52 weeks 52 weeks 52 weeks

ended ended ended ended ended ended
31 July 31 July 31 July 25 July 25 July 25 July
2022 2022 2022 2021 2021 2021
Before Exceptional After Before Exceptional After
exceptional items exceptional exceptional items exceptional
items (note 4) items items (note 4) items

£000 £000 £000 £000 £000 £000

Disposals
Fixed assets 3,492 (16) 3,476 1,548 1,592 3,140
Leases (7,368) – (7,368) (2,200) – (2,200)
Additional costs of disposal 1,857 112 1,969 775 115 890
(2,019) 96 (1,923) 123 1,707 1,830
Impairments
Property, plant and equipment (note 13) – 19,451 19,451 – 1,999 1,999
Investment properties (note 14) – 1,015 1,015 – – –
Right-of-use assets (note 23) – 3,964 3,964 – 2,133 2,133
– 24,430 24,430 – 4,132 4,132
Other
Other property gains (123) – (123) – – –
(123) – (123) – – –

Total property losses/(gains) (2,142) 24,526 22,384 123 5,839 5,962

16 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 NOTES TO THE FINANCIAL STATEMENTS

4. Exceptional items

Restated1
53 weeks
52 weeks
ended ended
31 July 25 July
2022 2021
£000 £000
Exceptional operating items
Rank settlement (27,771) –
Local government support grants (1,443) (11,123)
Duty drawback (170) (4,418)
Exceptional operating income (29,384) (15,541)

Equipment – 3,753
Stock losses – 4,158
Staff costs – 15,692
Other – 879
Exceptional operating costs – 24,482
Total exceptional operating (profit)/loss (29,384) 8,941

Exceptional property losses

Disposal programme
Loss on disposal of pubs 96 1,707
96 1,707
Other property losses
Impairment of assets under construction 2,215 –
Impairment of property, plant and equipment 17,236 1,999
Impairment of investment properties 1,015 –
Impairment of right of use assets 3,964 2,133
24,430 4,132

Total exceptional property losses 24,526 5,839

Other exceptional items

Exceptional finance costs 1,000 12,690
Exceptional finance income (52,859) –
(51,859) 12,690
Exceptional tax
Exceptional tax Items1 (2,102) 6,336
Tax effect on exceptional items 14,664 (3,271)
12,562 3,065

Total exceptional items1 (44,155) 30,535

1
Restated 25 July 2021. See Accounting policies page 48

Rank Settlement
The company has recognised £27,771,000 from HMRC in relation to a long-standing claim, regarding the historic VAT treatment
of slot/fruit machines.

The cash received from HMRC was £17,202,000. An amount of £10,569,000 was withheld to settle tax liabilities.This cash was
received at the beginning of FY23.

Local government support grants

The company has recognised £1,443,000 (2021: £11,123,000) of local government support grants in the UK and the Republic of
Ireland, associated with the COVID-19 pandemic.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 17

NOTES TO THE FINANCIAL STATEMENTS

Duty drawback
A credit of £170,000 (2021: £4,418,000) for duty drawback was received for perished stock during the period in relation to the
COVID-19 lockdown in the UK.

Disposal programme
The company has offered several of its sites for sale. At the end of the period, one (2021: one) further site had been sold.

In the table on the previous page, the costs classified under the ‘exceptional property losses – disposal programme’ relate to the
loss on disposal of this sold site.

Other property losses

Property impairment relates to pubs which are deemed unlikely to generate sufficient cash flows in the future to support their
carrying value. In the year, a total impairment charge of £23,415,000 (2021: £4,132,000) was incurred in respect of the
impairment of assets as required under IAS 36. This included £3,420,000 reversal of impairments recognised in the year (2021:
£Nil).

In the year, a total impairment charge of £1,015,000 (2021: £Nil) was incurred in respect of the impairment of our investment
properties.

Exceptional finance costs

The exceptional finance costs of £1,000,000 relates to covenant-waiver fees.

Exceptional finance income

The company has recognised exceptional finance income of £52,859,000, which relates to the fair value movement on a
proportion of its interest rate swaps. £48,527,000 relates to swap transactions where hedge accounting does not apply resulting
in fair value movements being recognised through the profit or loss. £4,332,000 relates to hedge ineffectiveness. See page 37
for details.

Taxation
The exceptional tax credit of £2,102,000 relates to the impact of the change in UK tax rate on deferred tax balances.

The tax effect on exceptional items is a charge of £14,664,000 and primarly relates to; derivative contracts (£10,009,000
charge), and the reduction of deferred tax assets in respect of tax losses (£4,653,000 charge).

18 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 NOTES TO THE FINANCIAL STATEMENTS

5. Employee benefits expenses

53 weeks 52 weeks
ended ended
31 July 25 July
2022 2021
£000 £000

Wages and salaries 639,366 520,339

Employee support grants (note 24) (4,473) (208,986)
Social security costs 41,637 23,380
Other pension costs 9,657 7,877
Share-based payments 5,874 10,267
Redundancy and restructuring costs – 6,179
692,061 359,056

Directors’ emoluments 2022 2021

£000 £000

Aggregate emoluments 1,984 1,709

Aggregate amount receivable under long-term incentive schemes 527 181
Company contributions to money purchase pension scheme 195 178
2,706 2,068

Employee support grants disclosed above are amounts claimed by the company under the coronavirus job retention schemes in
the UK and the Republic of Ireland.

For further details of directors’ emoluments including the highest paid director, please see the directors’ remuneration report on
pages 69–77.
2022 2021
Number Number

Full-time equivalents
Head office 332 315
Pub managerial 4,648 4,271
Pub hourly paid staff 19,791 18,736
24,771 23,322

2022 2021
Number Number

Total employees
Head office 342 326
Pub managerial 4,757 4,377
Pub hourly paid staff 37,028 34,322
42,127 39,025

The totals above relate to the monthly average number of employees during the year, not the total of employees at the end of
the year.

Share-based payments 53 weeks 52 weeks

ended ended
31 July 25 July
2022 2021

Shares awarded during the year (shares) 2,048,275 852,261

Average price of shares awarded (pence) 909 957
Market value of shares vested during the year (£000) 7,122 9,169
Share awards not yet vested (£000) 11,275 14,608

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 19

NOTES TO THE FINANCIAL STATEMENTS

5. Employee benefits expenses (continued)

For details of the share incentive plan and the deferred bonus scheme, refer to the directors’ remuneration report on pages 69–
77.

The shares awarded as part of the above schemes are based on the cash value of the bonuses at the date of the awards.
These awards vest over three years, with their cost spread over their three-year life. The share-based payment charge above
represents the annual cost of bonuses awarded over the past three years. All awards are settled in equity.

The company operates two share-based compensation plans. In both schemes, the fair values of the shares granted are
determined by reference to the share price at the date of the award. The shares vest at a £Nil exercise price – and there are
no market-based conditions to the shares which affect their ability to vest.

6. Finance income and costs

53 weeks 52 weeks
ended ended
31 July 25 July
2022 2021
£000 £000
Finance costs
Interest payable on bank loans and overdrafts 22,869 21,903
Amortisation of bank loan and private placement issue costs (note 10) 1,983 1,746
Interest payable on swaps 9,220 18,228
Interest payable on asset-financing 448 664
Interest payable on private placement 6,238 4,907
Finance costs excluding lease interest 40,758 47,448

Interest payable on leases 18,083 19,832

Total finance costs 58,841 67,280

Bank interest receivable (103) (188)

Lease interest receivable (428) (407)
Total finance income (531) (595)

Net finance costs before exceptionals 58,310 66,685

Exceptional finance costs (note 4) 1,000 12,690

Exceptional finance income (note 4) (52,859) -
Total exceptional finance (income)/costs (51,859) 12,690

Net finance costs after exceptionals 6,451 79,375

20 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 NOTES TO THE FINANCIAL STATEMENTS

7. Income tax expense

(a) Tax on loss on ordinary activities

The standard rate of corporation tax in the UK is 19.0%. The company’s profits for the accounting period are taxed at a rate of
19.0% (2021: 19.0%).

Restated1 Restated1
53 weeks 53 weeks 53 weeks 52 weeks
52 weeks 52 weeks
ended ended ended ended ended ended
31 July 2022 31 July 2022 31 July 2022 25 July 2021 25 July 2021 25 July 2021
Before Exceptional After Before Exceptional After
exceptional items exceptional exceptional items exceptional
items (note 4) items items (note 4) items
£000 £000 £000 £000 £000 £000

Taken through income statement

Current income tax:
Current income tax charge 22 – 22 (380) – (380)
Previous period adjustment – 2 2 – 1,836 1,836
Total current income tax 22 2 24 (380) 1,836 1,456

Deferred tax:
Origination and reversal of temporary differences1 (4,529) 14,662 10,133 (19,158) (2,546) (21,704)
Prior year deferred tax credit (1,053) – (1,053) (1,157) (2,561) (3,718)
Impact of change in UK tax rate – (2,102) (2,102) – 6,336 6,336
1
Total deferred tax (5,582) 12,560 6,978 (20,315) 1,229 (19,086)

Tax (credit)/charge1 (5,560) 12,562 7,002 (20,695) 3,065 (17,630)

53 weeks 53 weeks 53 weeks 52 weeks 52 weeks 52 weeks

ended ended ended ended ended ended
31 July 2022 31 July 2022 31 July 2022 25 July 2021 25 July 2021 25 July 2021
Before Exceptional After Before Exceptional After
exceptional items exceptional exceptional items Exceptional
items (note 4) items items (note 4) Items
£000 £000 £000 £000 £000 £000

Taken through equity

Current tax (2) – (2) 6 – 6
Deferred tax 22 – 22 (22) – (22)
Tax charge/(credit) 20 – 20 (16) – (16)

Restated1 Restated1
53 weeks 53 weeks 53 weeks 52 weeks
52 weeks 52 weeks
ended ended ended ended ended ended
31 July 2022 31 July 2022 31 July 2022 25 July 2021 25 July 2021 25 July 2021
Before Exceptional After Before Exceptional After
exceptional items exceptional exceptional items exceptional
items (note 4) items items (note 4) items
£000 £000 £000 £000 £000 £000

Taken through comprehensive income

Deferred tax charge on swaps1 8,404 – 8,404 6,241 4,049 10,290
Impact of change in UK tax rate 2,647 – 2,647 (1,157) – (1,157)
Tax charge/(credit)1 11,051 – 11,051 5,084 4,049 9,133
1
Restated 25 July 2021. See Accounting policies page 48

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 21

NOTES TO THE FINANCIAL STATEMENTS

7. Income tax expense (continued)

(b) Reconciliation of the total tax charge

The taxation charge for the 53 weeks ended 31 July 2022 is based on the pre-exceptional loss before tax of £30.4m and the
estimated effective tax rate before exceptional items for the 53 weeks ended 31 July 2022 of 18.3% (Restated1 2021: 14.8%).
This comprises a pre-exceptional current tax rate of 0.1% (Restated1 2021: 0.2%) and a pre-exceptional deferred tax charge of
18.3% (Restated1 2021: 14.6% charge).

The UK standard weighted average tax rate for the period is 19.0% (2021: 19.0%). The current tax rate is lower than the UK
standard weighted average tax rate, owing to tax losses in the period.

Restated1
53 weeks 53 weeks
52 weeks 52 weeks
ended ended ended ended
31 July 2022 31 July 2022 25 July 2021 25 July 2021
Before After Before After
exceptional exceptional exceptional exceptional
items items items items
£000 £000 £000 £000
(Loss)/profit before income tax (30,448) 26,269 (167,166) (194,636)

(Loss)/profit multiplied by the UK standard rate of (5,785) 4,991 (31,762) (36,981)

corporation tax of 19.0% (2021: 19.0%)
Abortive acquisition costs and disposals 498 498 - -
Expenditure not allowable 1,001 1,001 1,791 4,680
Fair value movement on SWAP disregarded for tax – 34 - -
Other allowable deductions 168 (9) (19) (19)
Non-qualifying depreciation 60 4,105 7,029 7,029
Capital gains - effect of reliefs 396 380 728 728
Share options and SIPs (669) (669) 955 955
Deferred tax on balance-sheet-only items (162) (162) - -
Effect of different tax rates and unrecognised losses in overseas
(14) (14) 1,740 1,524
companies
Rate change adjustment1 – (2,102) - 6,336
Previous year adjustment – current tax – 2 - 1,836
Previous year adjustment – deferred tax (1,053) (1,053) (1,157) (3,718)

Total tax expense reported in the income statement1 (5,560) 7,002 (20,695) (17,630)
1
Restated 25 July 2021. See Accounting policies page 48

22 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 NOTES TO THE FINANCIAL STATEMENTS

7. Income tax expense (continued)

(c) Deferred tax

The deferred tax in the balance sheet is as follows:

The main rate of corporation tax is currently 19%, but this will increase to 25% from 1 April 2023. The rate increase has been
substantively enacted; therefore, the deferred tax balances have been recognised at the rate they are expected to reverse. It is
noted that the government intends to hold the main rate of corporation tax at 19% but this decision had not been substantively
enacted at the reporting date.

Deferred tax liabilities

Accelerated Other Interest-rate Total

tax temporary swaps
depreciation differences
£000 £000 £000 £000
At 25 July 2021 50,593 5,536 – 56,129
Previous year movement posted to the income statement (908) (146) – (1,054)
Movement during year posted to the income statement 837 (12) – 825
Impact of tax rate change posted to the income statement 266 140 – 406
Reclassification from deferred tax asset to deferred tax
– – 14,834 14,834
liability
At 31 July 2022 50,788 5,518 14,834 71,140

Deferred tax assets

Share based Tax losses and Interest-rate Total
payments interest swaps
capacity
carried forward
£000 £000 £000 £000
At 25 July 2021 807 29,365 9,412 39,584
Movement during year posted to the income statement (139) 875 (10,043) (9,307)
Movement during year posted to comprehensive income – – (8,384) (8,384)
Movement during year posted to equity (22) – – (22)
Impact of change in tax rate posted to income statement – 5,536 (3,172) 2,364
Impact of change in tax rate posted to comprehensive income – – (2,647) (2,647)
Reclassification from deferred tax asset to deferred tax liability – – 14,834 14,834
At 31 July 2022 646 35,776 - 36,422

The company has recognised deferred tax assets of £36.4m (2021: £39.6m), which are expected to be offset against future
profits. This includes a deferred tax asset of £35.8m (2021: £29.4m), in respect of UK tax losses and current-year interest
restrictions capable of reactivation in future periods. This is on the basis that forecasts have been prepared indicating that profits
will arise in the foreseeable future, enabling the assets to be utilised.

Deferred tax assets and liabilities have been offset as follows:

2022 2021
£000 £000

Deferred tax liabilities 71,140 56,129

Offset against deferred tax assets (36,422) (39,584)
Deferred tax liabilities 34,718 16,545

Deferred tax assets 36,422 39,584

Offset against deferred tax liabilities (36,422) (39,584)
Deferred tax asset - –

As at 31 July 2022, the company had a potential deferred tax asset of £10.9m (2021: £9.1m) relating to capital losses (gross tax
losses £35.0m (2021: £26.1m)) and tax losses in the Republic of Ireland (gross tax losses £18.4m (2021: £18.3m)). Both types
of losses do not expire and will be available to use in future periods indefinitely. A deferred tax asset has not been recognised,
as there is insufficient certainty of recovery.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 23

NOTES TO THE FINANCIAL STATEMENTS

8. Earnings and free cash flow per share

Weighted average number of shares

Basic earnings/(loss) per share is calculated by dividing the profit/(loss) after tax for the period by the weighted average number
of ordinary shares in issue during the financial year of 128,750,155 (2021: 124,668,915) less the weighted average number of
shares held in trust during the financial year of 1,924,810 (2021: 1,841,667). Shares held in trust are shares purchased by the
company to satisfy employee share schemes that have not yet vested.

Diluted earnings/(loss) per share is calculated by dividing the profit/(loss) after tax for the period by the weighted average
number of ordinary shares in issue during the financial year adjusted for both shares held in trust and the effects of potentially
dilutive shares. For the company, the dilutive shares are those that relate to employee share schemes that have not been
purchased in advance and have not yet vested. For the year ended 31 July 2022 and 25 July 2021, the shares were anti-dilutive
due to the movements in the average share price against the exercise price of the share scheme. In the event of making a loss
during the year, the diluted loss per share is capped at the basic earnings per share as the impact of dilution cannot result in a
reduction in the loss per share.

Weighted average number of shares 53 weeks 52 weeks

ended ended
31 July 25 July
2022 2021

Shares in issue 128,750,155 124,668,915

Shares held in trust (1,924,810) (1,841,667)
Shares in issue - Basic 126,825,345 122,827,248
Dilutive shares - -
Shares in issue - Diluted 126,825,345 122,827,248

Earnings / (loss) per share

53 weeks ended 31 July 2022 Profit/(loss) Basic EPS Diluted EPS

£000 pence pence
Earnings (profit after tax) 19,267 15.2 15.2
Exclude effect of exceptional items after tax (44,155) (34.8) (34.8)
Earnings before exceptional items (24,888) (19.6) (19.6)
Exclude effect of property losses (note 3) (2,142) (1.7) (1.7)
Underlying earnings before exceptional items (27,030) (21.3) (21.3)

Restated1 52 weeks ended 25 July 2021 (Loss)profit Basic EPS Diluted EPS

£000 pence pence

Earnings (loss after tax) (177,006) (144.1) (144.1)

Exclude effect of exceptional items after tax1 30,535 24.9 24.9
Earnings before exceptional items1 (146,471) (119.2) (119.2)
Exclude effect of property gains (note 3) 123 0.1 0.1
Underlying earnings before exceptional items 1 (146,348) (119.1) (119.1)

1
Restated 25 July 2021. See Accounting policies page 48

24 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 NOTES TO THE FINANCIAL STATEMENTS

9. Cash used in/generated from operations

Restated1
53 weeks
52 weeks
ended ended
31 July 25 July
2022 2021
£000 £000

Profit/(loss) for the period1 19,267 (177,006)

Adjusted for:
Tax (note 7)1 7,002 (17,630)
Share-based charges (note 2) 5,874 10,267
Loss on disposal of property, plant and equipment (note 3) 3,476 3,140
Disposal of capitalised leases (note 3) (7,368) (2,200)
Net impairment charge (note 3) 24,430 4,132
Interest receivable (note 6) (103) (188)
Interest payable (note 6) 41,395 45,702
Lease interest receivable (note 6) (428) (407)
Lease interest payable (note 6) 18,083 19,832
Exceptional interest (note 6) (51,859) 12,690
Amortisation of bank loan and private placement issue costs (note 6) 1,983 1,746
Depreciation of property, plant and equipment (note 13) 71,227 73,193
Amortisation of intangible assets (note 12) 3,240 3,151
Depreciation on investment properties (note 14) 87 44
Aborted properties costs 2,947 628
Cancelled principal payments (note 23) (4,726) (10,993)
Foreign exchange movements (1,474) -
Amortisation of right-of-use assets (note 23) 42,291 44,532
175,344 10,633
Change in inventories 452 (3,758)
Change in receivables (12,171) 15,748
Change in payables 14,885 2,585
Cash flow from operating activities 178,510 25,208
1
Restated 25 July 2021. See Accounting policies page 48

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 25

NOTES TO THE FINANCIAL STATEMENTS

10. Analysis of change in net debt

25 July Cash Other 31 July

2021 flows changes 2022

£000 £000 £000 £000

Borrowings
Cash and cash equivalents 45,408 (5,061) – 40,347
Other loan receivable – due before one year – 803 – 803
Asset-financing obligations – due before one year (7,610) 2,473 – (5,137)
Current net borrowings 37,798 (1,785) – 36,013

Bank loans – due after one year (776,871) (49,808) (1,937) (828,616)
Asset-financing obligations – due after one year (8,633) 4,659 – (3,974)
Other loan receivable – due after one year – 2,739 – 2,739
Private placement – due after one year (97,768) – (46) (97,814)
Non-current net borrowings (883,272) (42,410) (1,983) (927,665)

Net debt (845,474) (44,195) (1,983) (891,652)

Derivatives
Interest-rate swaps assets - due after one year – – 61,367 61,367
Interest-rate swaps liability – due after one year (37,643) – 35,612 (2,031)
Total derivatives (37,643) – 96,979 59,336

Net debt after derivatives (883,117) (44,195) 94,996 (832,316)

Leases
Lease assets – due before one year 1,638 (1,423) 1,786 2,001
Lease assets – due after one year 9,890 – (626) 9,264
Lease obligations – due before one year (65,219) 40,049 (23,301) (48,471)
Lease obligations – due after one year (458,596) – 37,014 (421,582)
Net lease liabilities (512,287) 38,626 14,873 (458,788)

Net debt after derivatives and lease liabilities (1,395,404) (5,569) 109,869 (1,291,104)

The cash movement on bank loans of £49,808,000 is disclosed in the cash flow statement. The amount is the net of
£50,000,000 which is shown as an advance/(repayment) under bank loans and the £192,000 of loan issue costs.

The cash movement on asset-financing of £7,132,000 is disclosed in the cash flow statement as ‘asset-financing principal
payments’.

Lease obligations represent long-term payables, while lease assets represent long-term receivables – both are, therefore,
disclosed in the table above.

Non-cash movements
The non-cash movement in bank loans and the private placement relate to the amortisation of loan issue costs. The
amortisation charge for the year of £1,983,000 is disclosed in note 6. These are arrangement fees paid in respect of new
borrowings and are charged to the income statement over the expected life of the loans.

The movement in interest-rate swaps relates to the change in the ‘mark to market’ valuations for the year for swaps subject to
hedge accounting.

Non-cash movement in net lease liabilities 53 weeks ended 31 July 2022 31 July
2022
£000

Recognition of new leases (note 23) (4,458)

Freehold reversions of existing lease liabilities (note 23) 15,740
Remeasurements of existing leases liabilities (note 23) (6,742)
Remeasurements of existing leases assets (note 23) 1,160
Disposal of lease (note 23) 4,514
Cancelled principal payments (note 23) 4,726
Exchange differences (note 23) (67)
Non-cash movement in net lease liabilities 14,873

26 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 NOTES TO THE FINANCIAL STATEMENTS

10. Analysis of change in net debt (continued)

Analysis of changes in net debt for 52 weeks ended 25 July 2021

26 July Cash Other 25 July

2020 flows changes 2021
Restated
£000 £000 £000 £000

Borrowings
Cash and cash equivalents 174,451 (129,043) – 45,408
Asset-financing obligations – due before one year (7,610) – – (7,610)
Current net borrowings 166,841 (129,043) – 37,798

Bank loans – due after one year (870,572) 95,401 (1,700) (776,871)
Asset-financing obligations – due after one year (15,534) 6,901 – (8,633)
Private placement – due after one year (97,722) – (46) (97,768)
Non-current net borrowings (983,828) 102,302 (1,746) (883,272)

Net debt (816,987) (26,741) (1,746) (845,474)

Derivatives
Interest-rate swaps liability – due after one year (82,194) – 44,551 (37,643)
Total derivatives (82,194) – 44,551 (37,643)

Net debt after derivatives (899,181) (26,741) 42,805 (883,117)

Leases
Lease assets – due before one year 1,736 (1,323) 1,225 1,638
Lease assets – due after one year 11,115 – (1,225) 9,890
Lease obligations – due before one year (65,343) 18,875 (18,751) (65,219)
Lease obligations – due after one year (507,803) – 49,207 (458,596)
Net lease liabilities (560,295) 17,552 30,456 (512,287)

Net debt after derivatives and lease liabilities (1,459,476) (9,189) 73,261 (1,395,404)

Non-cash movement in net lease liabilities 52 weeks ended 25 July 2021 25 July
2021
£000

Recognition of new leases (note 23) (12,162)

Remeasurements of existing leases liabilities (note 23) 15,602
Disposal of lease (note 23) 15,790
Cancelled principal payments (note 23) 10,993
Exchange differences (note 23) 233
Non-cash movement in net lease liabilities 30,456

11. Dividends paid and proposed

No final dividend has been proposed for approval at the annual general meeting for the 53 weeks ended 31 July 2022 (2021:
Nil). Covenants restrict the payment of dividends while the company is part of the coronavirus large business interruption loan
scheme (CLBILS). The board will continue to review the dividend policy.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 27

NOTES TO THE FINANCIAL STATEMENTS

12. Intangible assets

Computer Assets Total

software and under

development construction

£000 £000 £000

Cost:
At 26 July 2020 33,417 804 34,221
Additions – 4 4
Transfers 804 (804) –
Disposals (1,474) – (1,474)
At 25 July 2021 32,747 4 32,751
Additions 2,875 429 3,304
Disposals (20) – (20)
At 31 July 2022 35,602 433 36,035

Accumulated amortisation:
At 26 July 2020 (25,326) – (25,326)
Provided during the period (3,151) – (3,151)
Exchange differences (1) – (1)
Disposals 1,085 – 1,085
At 25 July 2021 (27,393) – (27,393)
Provided during the period (3,240) – (3,240)
Disposals 7 – 7
At 31 July 2022 (30,626) – (30,626)

Net book amount at 31 July 2022 4,976 433 5,409

Net book amount at 25 July 2021 5,354 4 5,358
Net book amount at 26 July 2020 8,091 804 8,895

The majority of intangible assets relate to computer software and software development. Examples include the development
costs of the SAP accounting and property-maintenance systems and bespoke J D Wetherspoon applications.

28 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 NOTES TO THE FINANCIAL STATEMENTS

13. Property, plant and equipment

Freehold and Short- Equipment, Assets Total

long-leasehold leasehold fixtures under
property property and fittings construction
£000 £000 £000 £000 £000

Cost:
At 26 July 2020 1,363,106 295,009 684,732 86,624 2,429,471
Additions 14,783 132 11,251 31,973 58,139
Transfers from investment property 5,768 – – – 5,768
Transfers 41,023 4,164 8,385 (53,572) –
Exchange differences (1,357) (144) (426) (1,157) (3,084)
Disposals (2,623) (4,385) (3,631) – (10,639)
Reclassification 7,842 (7,842) – – –
At 25 July 2021 1,428,542 286,934 700,311 63,868 2,479,655
Additions 37,019 8,407 33,146 33,700 112,272
Transfers from investment property - - - (2,170) (2,170)
Transfers 15,948 1,185 2,572 (19,705) -
Exchange differences (1,257) (53) (201) (242) (1,753)
Transfers to assets held for sale (1,739) - - - (1,739)
Disposals (13,614) (3,708) (4,713) - (22,035)
Reclassification 12,435 (12,435) - - -
At 31 July 2022 1,477,334 280,330 731,115 75,451 2,564,230

Accumulated depreciation and impairment:

At 26 July 2020 (307,297) (167,009) (512,387) – (986,693)
Provided during the period (20,281) (10,499) (42,413) – (73,193)
Transfers from investment property (290) – – – (290)
Exchange differences 282 23 249 – 554
Impairment loss (1,631) (368) – – (1,999)
Disposals 874 2,405 2,513 – 5,792
Reclassification (4,090) 4,090 – – –
At 25 July 2021 (332,433) (171,358) (552,038) – (1,055,829)
Provided during the period (21,336) (9,704) (40,187) - (71,227)
Exchange differences 122 19 148 - 289
Impairment loss (18,617) 279 1,102 (2,215) (19,451)
Transfers to assets held for sale 939 - - - 939
Disposals 3,752 2,288 1,871 - 7,911
Reclassification (6,960) 6,960 - - -
At 31 July 2022 (374,533) (171,516) (589,104) (2,215) (1,137,368)

Net book amount at 31 July 2022 1,102,801 108,814 142,011 73,236 1,426,862
Net book amount at 25 July 2021 1,096,109 115,576 148,273 63,868 1,423,826
Net book amount at 26 July 2020 1,055,809 128,000 172,345 86,624 1,442,778

During the period, an amount of £42,777,000 (2021: £19,692,000) was spent on the reinvestment of existing pubs. £25,773,000
(2021: £16,858,000) was spent on freehold reversions. £58,789,000 (2021: £24,051,000) was spent on investment in new pubs
and pub extensions. This led to a total capital expenditure of £127,339,000 (2021: £62,671,000).

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 29

NOTES TO THE FINANCIAL STATEMENTS

14. Investment property

The company owns six (2021: three) freehold properties with existing tenants – and these assets have been classified
as investment properties. During the year, a property which was originally recognised as part of property, plant and equipment
under the category ‘assets under construction’ has been transferred to investment property. During the year, the company has
purchased an additional two investment properties.

£000

Cost:
At 26 July 2020 11,842
Additions 4,528
Transfer to property, plant and equipment (5,768)
At 25 July 2021 10,602
Transfer from property, plant and equipment 2,170
Additions 11,763
At 31 July 2022 24,535

Accumulated amortisation:
At 26 July 2020 (315)
Provided during the period (44)
Transfer to property, plant and equipment 290
At 25 July 2021 (69)
Provided during the period (87)
Impairment loss (1,015)
At 31 July 2022 (1,171)

Net book amount at 31 July 2022 23,364

Net book amount at 25 July 2021 10,533
Net book amount at 26 July 2020 11,527

Rental income received in the period from investment properties was £790,000 (2021: £397,000).
Operating costs, excluding depreciation, incurred in relation to these properties amounted to £16,000 (2021: £12,000).

At the year end, three investment properties were independently valued at £9,431,000. During the year, an impairment charge
of £1,015,000 was incurred to adjust the three investment properties which were independently valued from their net book value
to their valuation amount. The remaining three investment properties purchased during the period are valued at their purchase
price paid of £13,933,000. This is deemed a reasonable fair value of these properties. The total fair value of all of our investment
properties at the year end is £23,364,000.

30 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 NOTES TO THE FINANCIAL STATEMENTS

15. Inventories

Bar, food and non-consumable stock held at pubs and the national distribution centre.

31 July 25 July
2022 2021
£000 £000

Goods for resale at cost 26,402 26,853

16. Receivables
This category relates to situations in which third parties owe the company money. Examples include rebates from suppliers
(volume related discounts on certain products) and refunds from councils and governing bodies.

Prepayments relate to advance payments for certain services, for example insurance and tv licences.
31 July 25 July
2022 2021
£000 £000

Current (due within one year)

Other loan receivables 803 –
Other receivables 18,601 2,004
Rebate receivable 1,998 1,499
Prepayments 7,998 12,924
29,400 16,427

Non-current (due after one year)

Other loan receivables 2,739 –
Total other non-current assets 2,739 –

On 4 August 2022 a cheque was received for £11,347,000 from HMRC in relation to the historic VAT treatment of slot/fruit
machines (see note 4 for further details). This cheque was dated before the year-end of 26 July 2022. However, owing to not
receiving this cheque until after year-end this amount has been recognised as a receivable under ‘other receivables’ rather than
in cash and cash equivalents in note 18.

Credit risk 31 July 25 July

2022 2021
£000 £000

Due from suppliers – not due 937 1,040

Due from suppliers – overdue 193 964
1,130 2,004

Credit risk is the risk that a counterparty does not settle its financial obligation with the company. At the period’s end, the
company has assessed the credit risk on amounts due from suppliers, based on historic experience, meaning that the expected
lifetime credit loss was immaterial. Cash and cash equivalents are also subject to the impairment requirements of IFRS9 – no
impairment loss was identified..

17. Assets held for sale

These relate to situations in which the company had exchanged contracts to sell a property, but the transaction is not yet
complete. As at 31 July 2022, two sites were classified as held for sale (2021:£Nil).

31 July 25 July
2022 2021
£000 £000

Property, plant and equipment 800 –

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 31

NOTES TO THE FINANCIAL STATEMENTS

18. Cash and cash equivalents

31 July 25 July
2022 2021
£000 £000

Cash and cash equivalents 40,347 45,408

Cash at bank earns interest at floating rates, based on daily bank deposit rates.

On 4 August 2022 a cheque was received for £11,347,000 from HMRC in relation to the historic VAT treatment of slot/fruit
machines (see note 4 for further details). This cheque was dated before the year-end of 26 July 2022. However, owing to not
receiving this cheque until after year-end this amount has been recognised as a receivable under ‘other receivables’ in note 16.

19. Trade and other payables

This category relates to money owed by the company to third parties.

31 July 25 July
2022 2021
£000 £000

Trade payables 107,886 111,918

Other payables 17,267 27,759
Other tax and social security 67,362 44,237
Accruals 88,758 74,787
Deferred income 1,208 1,090
282,481 259,791

Trade payables are obligations to pay for goods and services which are of a trade nature while other payables are of a non-
trade nature.

Included within tax and social security is corporation tax liability owed but not yet due of £280,000 (2021: £20,383,000) and VAT
due of £56,516,000 (2021: £12,069,000).

Accruals relate to allowances made by the company for future anticipated payments, for example; payments to suppliers,
employees’ wages and interest payments to lenders.

Deferred income comprises of money received in advance for future marketing materials and services.

32 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 NOTES TO THE FINANCIAL STATEMENTS

20. Borrowings

31 July 25 July
2022 2021
£000 £000

Current (due within one year)

Other
Lease liabilities 48,471 65,219
Asset-financing obligations 5,137 7,610
Total current borrowings (including lease liabilities) 53,608 72,829

Non-current (due after one year)

Bank loans
Variable-rate facility 730,000 680,000
CLBILS 100,033 100,033
Unamortised bank loan issue costs (1,417) (3,162)
828,616 776,871
Private placement
Fixed-rate facility 98,000 98,000
Unamortised private placement issue costs (186) (232)
97,814 97,768
Other
Lease liabilities 421,582 458,596
Asset-financing obligations 3,974 8,633
425,556 467,229

Total non-current borrowings (including lease liabilities) 1,351,986 1,341,868

Total borrowings (including lease liabilities) 1,405,594 1,414,697

Lease liabilities
The carrying amounts of lease liabilities and the movements during the period are outlined in note 23.

Asset-financing obligations
Asset-financing obligations relate to asset finance leases of equipment in pubs.

Variable-rate facility
The secured Revolving Credit Facility is £875m. As at 31 July 2022, £730m was drawn down (2021: £680m). There are 14
participating lenders. £20m matures in February 2024 while £855m matures in February 2025. The company has hedged its
interest-rate liabilities to its banks by swapping the floating-rate debt into fixed-rate debt, see note 22.

CLBILS
On 7 August 2020 and 18 March 2021, the company agreed to secured loans under the CLBILS for £48,333,332 and
£51,700,000, respectively. The loans have four participating lenders and an average fixed-interest charge of 1.94%; all of loans
mature in August 2023.

Unamortised bank loan issue costs

Unamortised bank loan issue costs primarily relate to refinancing, securing and extending the variable-rate facility.

Private placement
The fixed-rate facility relates to senior secured notes of £98m. The notes mature in 2026.

The company has an overdraft facility of £10m.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 33

NOTES TO THE FINANCIAL STATEMENTS

21. Provisions

Total
£000

At 25 July 2021 3,004

Charged to the income statement:
– Additional charges 2,781
– Unused amounts reversed (2,588)
– Used during year (536)
At 31 July 2022 2,661

31 July 25 July
2022 2021
£000 £000

Current 2,661 3,004

Non-current – –
Total provisions 2,661 3,004

Legal claims
The amounts represent a provision for ongoing legal claims brought against the company in the normal course of business, by
customers and employees. Owing to the nature of the business, the company expects to have a continuous provision for
outstanding employee and public liability claims. All claim provisions are considered current and are therefore not discounted.

34 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 NOTES TO THE FINANCIAL STATEMENTS

22. Financial instruments

Fair values
The company has the following financial instruments. IFRS13 requires disclosure of fair value measurements by level, using the
following fair value measurement hierarchy:

 Quoted prices in active markets for identical assets or liabilities (level 1)

 Inputs other than quoted prices included in level 1 which are observable for the asset or liability,
either directly or indirectly (level 2)
 Inputs for the asset or liability which are not based on observable market data (level 3)

31 July 31 July 25 July 25 July

2022 2022 2021 2021
Book value Fair value Book value Fair value
Hierachy £000 £000 £000 £000

Financial assets at amortised cost

Cash and cash equivalents 40,347 40,347 45,408 45,408
Receivables 1,130 1,130 2,004 2,004
Lease assets 3
11,265 11,378 11,528 11,643
52,742 52,855 58,940 59,055
Financial liabilities at amortised cost
Trade and other payables (213,911) (213,911) (214,464) (214,464)
Asset-financing obligations 2 (9,111) (9,111) (16,243) (16,406)
Lease obligations 3 (470,054) (470,054) (523,815) (529,053)
Private placement 2
(97,814) (94,166) (97,768) (98,746)
Borrowings 2
(828,616) (811,795) (776,871) (784,639)
(1,619,506) (1,599,037) (1,629,161) (1,643,308)
Derivatives – cash flow hedges
Non-current derivative financial liability 2 (2,031) (2,031) (37,643) (37,643)
Non-current derivative financial asset 2 61,367 61,367 - -
59,336 59,336 (37,643) (37,643)
The fair value of derivatives has been calculated by discounting all future cash flows by the market yield curve. The fair value of
borrowings and the private placement has been calculated by discounting the expected future cash flows at the year end’s
prevailing interest rates. The borrowings are deemed to be short-term for the purposes of the fair value calculations (see note 20
for split) given the draw down nature of the Revolving Credit Facility. The fair value of investment properties has been disclosed
in note 14 (hierarchy level of 3).

Maturity profile of financial liabilities

The table below presents the maturity profile of the company’s financial liabilities using the contractual undiscounted cash flows.
Within More than
1 year 1–2 years 2–5 years 5 years Total
£000 £000 £000 £000 £000

At 31 July 2022
Borrowings 31,750 51,330 871,461 – 954,541
Borrowings – CLBILS 2,599 100,119 – – 102,718
Private placement 3,655 3,655 107,138 – 114,448
Trade and other payables 213,911 – – – 213,911
Derivatives 3,211 (698) (353) (1,858) 302
Lease liabilities 48,471 48,029 133,041 382,369 611,910
Asset-financing obligations 5,137 4,332 – – 9,469

At 26 July 2021
Borrowings 21,798 21,798 908,406 – 952,002
Borrowings – CLBILS 2,005 2,005 100,138 – 104,148
Private placement 3,655 3,655 10,965 99,828 118,103
Trade and other payables 214,464 – – – 214,464
Derivatives 12,054 11,969 15,842 5,231 45,096
Lease liabilities 65,219 49,587 142,670 427,520 684,996
Asset-financing obligations 7,610 5,145 4,323 – 17,078

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 35

NOTES TO THE FINANCIAL STATEMENTS

22. Financial instruments (continued)

Capital risk management
The company’s capital structure comprises shareholders’ equity and loans. The objective of capital management is to ensure
that the company is able to continue as a going concern and provide shareholders with returns on their investment, while
managing risk.

The company does not have a specific measure for managing capital structure; instead, the company plans its capital
requirements and manages its loans, dividends and share buybacks accordingly. In a normal trading year, the company
measures loans using a ratio of net debt to EBITDA. With covenant waivers agreed until January 2023, relaxed covenants
effective April and July 2023 and returning to normal covenant levels from October 2023 management’s primary metrics are
liquidity until April 2023 and then profitability and net debt thereafter.

Liquidity rate risk management

Outlined in note 20 are the facilities entered into to meet the short and long-term liquidity needs of the business. The objective is
to ensure that the company has sufficient financial resources to meet working capital requirements as well as funds for
reinvestment and development. The company’s borrowings depend on the meeting of financial covenants, which if breached,
could result in funding being withdrawn. The company has agreed on covenant waivers with its lenders as outlined above.

Credit risk management

The company does not have a significant concentration of credit risk, as the majority of its revenue is in cash. There is little
associated credit risk assigned to derivative financial assets as contracts are held with commercial bank counterparties.

Interest rate risk management

The company is exposed to interest rate risk through variable rates on external borrowings. The company’s interest-rate swap
agreements are in place to mitigate this risk. Under these agreements, the company pays a fixed interest charge and receives
variable interest income which matches the variable interest payments made on the company’s borrowings.

The company has hedged its interest-rate liabilities to its banks by swapping the floating-rate debt into fixed-rate debt which
has fixed £770m of these borrowings at rates of between 0.61 and 3.84%. These interest rate swaps are accounted for through
a combination of fair value through profit or loss and hedging reserves within other comprehensive income. The effective
weighted average interest rate of the swap agreements used during the year is 1.61% (2021: 2.42%), fixed for a weighted
average period of 6.4 years (2021: 3.8 years). In addition, the company has entered into forward-starting interest-rate swaps,
detailed in the table below.

Weighted average swap by period:

From To Total swap value £m Weighted average interest %
30/07/2021 30/07/2023 770 1.61
30/07/2023 30/07/2026 770 1.10
31/07/2026 30/06/2028 770 1.33
01/07/2028 29/03/2029 770 1.32
31/03/2029 30/11/2031 770 1.02

Interest-rate sensitivity
The amounts drawn under this agreement can be varied, depending on the requirements of the business. The floating-rate
borrowings are interest-bearing borrowings at rates based on SONIA, fixed for periods of up to one month. During the 53 weeks
ended 31 July 2022, if the interest rates on UK-denominated borrowings had been 1% higher, with all other variables constant,
pre-tax loss for the year would have been reduced by £34,000 and equity increased by £67,660,000. The movement in equity
arises from a change in the ‘mark to market’ valuation of the interest-rate swaps into which the company has entered, calculated
by a 1% shift of the market yield curve. The company notes that an increase in borrowings of 1% would also increase interest
charges. The company considers that a 1% movement in interest rates represents a reasonable sensitivity to potential changes.
However, this analysis is for illustrative purposes only.

An analysis of the interest-rate profile of financial liabilities, is set out below:

31 July 25 July
2022 2021
£000 £000
Analysis of interest-rate profile of financial liabilities
Floating rate due after one year 728,583 676,839
Fixed rate due after one year 100,033 100,033
828,616 776,872
Asset-financing obligations
Fixed rate due in one year 5,137 7,610
Fixed-rate due after one year 3,974 8,633
9,111 16,243
Private placement
Fixed rate due after one year 97,814 97,767
97,814 97,767
935,541 890,882

36 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 NOTES TO THE FINANCIAL STATEMENTS

22. Financial instruments (continued)

The below table outlines the movements in fair value among the hedging reserve, comprehensive income and the income
statement during the year:
Restated1
2022 2021
Interest-rate swaps £000 £000
Carrying value of derivative financial instruments - Liability (2,031) (37,643)
Carrying value of derivative financial instruments - Asset 61,367 -
Change in fair value of derivatives 96,979 44,551
Hedge (gains)/losses recognised in comprehensive income in respect of continuing hedges (48,452) (44,551)
Hedge (gains)/losses recognised in profit or loss in respect of hedges held at fair value through
the profit or loss (Note 4) (48,527) -
Hedge ineffectiveness reclassified from the reserve to profit or loss relating to continuing
hedges (Note 4) (8,134) 11,707
Amortisation to profit or loss of cashflow hedge reserve relating to discontinued hedge
relationships (Note 4) 3,802 -
Hedging reserve balance in respect of continuing hedges1 (14,516) 19,452
Hedging reserve balance in respect of discontinued hedges 899 -

Restated1
2022 2021
Hedging Reserve £000 £000
Opening 19,452 66,577
Hedging (gains)/losses recognised in comprehensive income (48,452) (44,551)
Hedge ineffectiveness reclassified from the hedging reserve to profit or loss / Amortisation
to profit or loss of cashflow hedge reserve relating to discontinued hedge relationships 4,332 (11,707)
Deferred tax posted to comprehensive income1 11,051 9,133
Closing1 (13,617) 19,452
1
Restated 25 July 2021. See Accounting policies page 48

The company has multiple interest-rate swaps which up to 25 July 2021 were designated in a combination of seven hedge
relationships. In addition one new derivative was entered into during the year which has not been designated for hedge
accounting. The impact on the accounts is as follows:

 In the year ended 25 July 2021, three of the company’s hedge relationships were discontinued from hedge accounting
as a result of future variable debt no longer being forecast at the same levels as when the instruments were originally
established. Since 25 July 2021, the fair value movements on the respective derivatives are included in profit and
loss. The cash flow hedge reserve was frozen at the time of discontinuation and is amortised to the profit or loss
accordingly. Fair value movements of -£4,332k have been recognised in the income statement as opposed to other
comprehensive income during the financial period.
 On 29 October 2021, several interest-rate swaps that were designated within three of the hedge relationships were
novated from HSBC to Barclays. On novation, the interest-rate swap and the variable-rate debt no longer qualified for
hedge accounting, resulting in partial discontinuation being recognised.
 On 15 November 2021, a new derivative made up of one interest-rate swap was entered into for the purposes of fixing
variable rate debt from 2029 to 2031. The interest rate swap does not qualify for hedge accounting on the basis that
no hedge documentation was put in place to permit it. During the financial year, fair value movements of £16,230k
were recognised in the income statement as opposed to comprehensive income.
 During the year ended 31 July 2022, two relationships were deemed to be partially ineffective as a result of future
variable debt no longer being forecast at the same levels as when the instruments were originally established.
£4,013k was reclassified from the hedging reserve to profit or loss during the financial year as a result of partial
ineffectiveness of this swap. The company reviews and forecasts it’s variable debt financing requirements at each
reporting period. Any changes in forecasts impact the effectiveness of the interest-rate hedges in place which are for
a nominal value of £770m per period.

Remaining in the hedging reserve, is -£14,516k of fair value relating to continuing hedges (Restated1 2021: £19,452k) and
£899k of fair value relating to hedges which have been discontinued (2021: £Nil). The fair value of discontinued hedges will be
recycled to the income statement over the remaining period of maturity.

Interest-rate benchmark (IBOR) reform

The company’s interest-rate swaps, which swap floating interest rates paid for a fixed interest rate, were previously based on an
index called the London interbank offered rate (LIBOR). The IBOR issued in September 2019 has resulted in LIBOR being
replaced with an index called sterling overnight index average (SONIA). The amendments of the reform have been adopted, as
at 1 January 2022, to hedging relationships which already existed, or were designated thereafter.

The amendments provided temporary relief from applying specific hedge accounting requirements to hedging relationships
directly affected by IBOR reform. Hedges have still been measured for effectiveness, with any ineffectiveness being charged in
the income statement. No hedges have been derecognised as a result of the IBOR reform.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 37

NOTES TO THE FINANCIAL STATEMENTS

22. Financial instruments (continued)

Obligations under asset-financing
The minimum lease payments under asset-financing fall due as follows:
31 July 25 July
2022 2021
£000 £000

Within one year 5,137 7,610

In the second to fifth year, inclusive 4,332 9,468
9,469 17,078
Less future finance charges (358) (835)
Present value of lease obligations 9,111 16,243

Less amount due for settlement within one year (5,137) (7,610)
Amount due for settlement during the second to fifth year, inclusive 3,974 8,633

All asset-financing obligations are in respect of various equipment used in the business. No escalation clauses are included
in the agreements.

23. Leases

The following amounts, relating to lease cashflows, were debited/credited to the income statement during the period:
31 July 25 July
Rent cash flow analysis 2022 2021
£000 £000
Cash outflows relating to capitalised leases 57,630 35,829
Expense relating to short-term leases 10 784
Expense relating to variable element of concessions 8,799 2,801
Total cash outflows 66,439 39,414

Cash inflows relating to capitalised leases (1,852) (1,736)

Income relating to lessor sites (2,001) (1,609)
Total cash inflows (3,853) (3,345)

The balance sheet shows the following amounts relating to leases. These have been reconciled in sections (a) to (d) below:

31 July 25 July
Balance sheet position 2022 2021
£000 £000
1
Right-of-use asset (a) 419,416 468,538

Non-current lease asset 9,264 9,890

Current lease assets 2,001 1,638
2
Total lease assets (b) (d) 11,265 11,528

Current lease liability (48,471) (65,219)

Non-current lease liability (421,583) (458,596)
Total lease liability1 (c) (d) (470,054) (523,815)
1
Right-of-use assets and lease liabilities relate to leasehold properties occupied by J D Wetherspoon.
2
Lease assets relate to leasehold properties sublet by J D Wetherspoon.

38 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 NOTES TO THE FINANCIAL STATEMENTS

23. Leases (continued)

(a) Right-of-use assets

Set out below are the carrying amounts of right-of-use assets recognised and the movements during the period:

Cost: £000

As at 25 July 2021 558,897

Reclassification of prior year remeasurement1 3,704

Restated as at 25 July 2021 562,601

Additions 4,458

Remeasurement 10,148

Freehold reversions (16,492)

Disposals and derecognised leases (3,453)

At 31 July 2022 557,262

Accumulated depreciation and impairment: £000

As at 25 July 2021 (90,359)

Reclassification of prior year remeasurement (3,704)

Restated as at 25 July 2021 (94,063)

Provided during the period (42,291)

Exchange differences (77)

Impairment loss (3,964)

Freehold reversions 1,878

Disposals and derecognised leases 671

At 31 July 2022 (137,846)

Net book amount at 31 July 2022 419,416

Net book amount at 25 July 2021 468,538
1
A reclassiciation of prior year remeasurments has been made between cost and accumulated depreciation. This
reclassification does not impact the net book value of right-of-use assets.

During the period, additions related to four new lease contracts that were signed. 41 leases were remeasured as a result of
changes in the agreed payments under the lease contracts and changes in the lease terms. Exchange differences occur as a
result of translating the capitalised leases in the Republic of Ireland. 13 freehold reversions took place in the year while
disposals and derecognised leases totalled six. In the year ended 25 July 2021, lease additions totalled £12,162k and
depreciation £44,532k.

(b) Sublet properties

Set out below are the carrying amounts of the lease assets recognised and the movement during the period. The company
sublets several of its leases, with lease assets being the capitalised future rent receivable from sublet sites.
Lease assets
£000

As at 26 July 2020 12,851

Interest due in period 413
Cash inflows for the period (1,736)
As at 25 July 2021 11,528
Remeasurement of leases 1,160
Interest due in the period 428
Cash inflows for the period (1,851)
At 31 July 2022 11,265
Where needed, deferral terms were agreed on with lessees in relation to COVID-19 pandemic. There are no material expected
credit losses.

The interest payable and receivable shown in the table above is the interest element of the payments made and received in the
period. These amounts differ from the lease interest charged/credited to the income statement in the period – see note 6. The
amounts charged/credited to the income statement in the period will also include amounts due, yet not paid, in the period. The
incremental borrowing rate applied to lease liabilities and assets was 1.9–3.6%, depending on the lease’s length.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 39

NOTES TO THE FINANCIAL STATEMENTS

23. Leases (continued)

(c) Lease liability

Set out below are the carrying amounts of lease liabilities and the movements during the period:

Lease liability
2022 2021

£000 £000

Lease liability as at commencement of period 523,815 573,146

Additions 4,458 12,162

Freehold reversions (15,740) -

Remeasurements of leases 6,742 (15,602)

Disposals (4,514) (15,790)

Cancelled principal payments (due to expedient) (4,726) (10,993)

Exchange differences 67 (233)

Lease liabilities before payments 510,102 542,690

Interest payable in period:

Interest expense within period (discounting
18,083 19,872
element)
Cancelled interest expense (due to expedient) (501) (2,918)
17,582 16,954

Total cash outflow for leases in period:

Lease payment commitments for
(62,857) (53,602)
period
Cancelled payment commitments (due to
5,227 13,911
expedient)
Deferred payment commitments - 3,862
(57,630) (35,829)

Net principal payments at 31 July

(40,048) (18,875)
2022

At 31 July 2022 470,054 523,815

The company has applied the rent concessions practical expedient during the financial period, allowing reductions in rent
payments due on or before June 2022 to be credited to the income statement, rather than requiring remeasurement of the
lease.

Included within remeasurement of leases are principal payments of £4,726k (2021: £10,993k) credited to the income statement,
and a reduction in associated interest charges of £501k (2021: £2,918k) resulting in a total credit to the income statement of
£5,227k (2021: £13,911k) which is disclosed in cash generated from operations, note 9. Future rental payments, up to the end
of the lease, are capitalised, including any agreed increases.

Future rent payments could change as a result of open-market rent reviews or options being exercised to terminate a lease
early. Any changes in the minimum unavoidable lease payments will be included as a remeasurement of the lease liability. The
accounting policies (page 46) further describe the policy in relation to the termination of leases.

40 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 NOTES TO THE FINANCIAL STATEMENTS

23. Leases (continued)

(d) Lease maturity profile

Set out below are the remaining maturities (period between the balance sheet date and the end of the lease) of the lease
liabilities and lease assets, which are undiscounted:
Lease liabilities Lease assets
31 July 25 July 31 July 25 July
2022 2021 2022 2021
£000 £000 £000 £000

Within one year 48,471 65,219 2,001 1,638

Between one and two years 48,029 49,587 1,332 1,586
Between two and three years 46,233 49,508 1,140 1,130
Between three and four years 43,777 47,872 1,128 1,084
Between four and five years 43,031 45,290 1,124 1,070
After five years 382,369 427,520 6,518 7,255
Lease commitments payable / receviable 611,910 684,996 13,243 13,763

Discounting (141,856) (161,181) (1,978) (2,235)

Lease liability / lease asset 470,054 523,815 11,265 11,528

24. Government support

31 July 25 July
2022 2021
£000 £000
Eat out to help out (note 1) – (23,248)
Local government grants (note 4) (1,443) (11,123)
Employee support grants (note 5) (4,473) (208,986)
(5,916) (243,357)

The government support in the table above should be viewed in context of the contribution to the economy as on page 6.

Local government grants

From 9 September 2020, the UK Government made available several grants to support those businesses adversely affected by
the pandemic. Applications were made to the respective local authorities in line with the eligibility criteria for each scheme. The
Irish Government introduced a similar grant (COVID Restrictions Support Scheme), for which the company applied for centrally.
Government grants were recognised at the point at which funds were receipted. In the year, £1.4m was receipted (£1.3m in
relation to the UK and £0.1m in relation to the Republic of Ireland). The grants were treated as exceptional income.

Employee support grants

The coronavirus job retention scheme,(CJRS) and equivalent Republic of Ireland schemes, were introduced at the beginning of
the pandemic to support companies in retaining employees, in the form of grants to cover a proportion of the wages and salaries
of furloughed staff. The claims have been made weekly since April 2020 for weekly paid employees and monthly for salaried
employees. These are accounted for as a credit to wages and salaries within employee costs. In the year, £4.5m was receipted
(£0.2m in relation to the UK and £4.3m in relation to the Republic of Ireland).

25. Capital commitments

At 31 July 2022, the company had £9.8m (2021: £10.0m) of capital commitments, relating to the purchase of nine (2021: eight)
sites, for which no provision had been made in respect of property, plant and equipment.

The company had some other sites in the property pipeline; however, any legal commitment is contingent on planning and
licensing. Therefore, there are no commitments at the balance sheet date.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 41

NOTES TO THE FINANCIAL STATEMENTS

26. Related-party disclosures

J D Wetherspoon is the owner of the share capital of the following companies:
Country of incorporation Ownership Status
Company name
J D Wetherspoon (Scot) Limited Scotland Wholly owned Dormant
J D Wetherspoon Property Holdings Limited England Wholly owned Dormant
Moon and Spoon Limited England Wholly owned Dormant
Moon and Stars Limited England Wholly owned Dormant
Moon on the Hill Limited England Wholly owned Dormant
Moorsom & Co Limited England Wholly owned Dormant
Sylvan Moon Limited England Wholly owned Dormant
Checkline House (Head Lease) Limited Wales Wholly owned Dormant

All of these companies are dormant and contain no assets or liabilities and are, therefore, immaterial. As a result, consolidated
accounts have not been produced. The company has an overseas branch in the Republic of Ireland.

The registered office of all of the above companies is the same as that for J D Wetherspoon plc, as disclosed on the final page
of these accounts.

As required by IAS 24, the following information is disclosed about key management compensation.

Key management compensation 2022 2021

£000 £000
Short-term employee benefits 2,950 2,493
Post-employment pension benefits 611 280
Share-based payment 300 273
3,861 3,046

Key management comprises the executive directors, non-executive directors and management board, as detailed on page 65.

For additional information about directors’ emoluments, please refer to the directors’ remuneration report on pages 69–77.

Directors’ interests in employee share plans

Details of the shares held by executive members of the board of directors’ are included in the remuneration report on pages 69–
77 which forms part of these financial statements.

27. Share capital

Number of Share
shares capital
000s £000

At 26 July 2020 120,380 2,408

Issue of shares 8,370 167
At 25 July 2021 128,750 2,575
At 31 July 2022 128,750 2,575

The total authorised number of 2p ordinary shares is 500,000,000 (2021: 500,000,000). All issued shares are fully paid.

While the memorandum and articles of association allow for preferred, deferred or special rights to attach
to ordinary shares, no shares carried such rights at the balance sheet date.

28. Events after the balance sheet date

On 23 September 2022, the government announced a growth plan which included an intention for the main rate of corporation
tax to remain at 19%. This announcement does not affect the year ended 31 July 2022 and the change has not been
substantively enacted at the reporting date.

On 26 September 2022, the company announced that 32 of its pubs will be put on the market as part of a one-off disposal
programme. Mangaement has concluded this to be a non-adjusting event on the basis that events and conditions arose after
the end of the financial period. Of the 32 pubs being marketed, 10 are freehold and 22 are leasehold units. A reasonable
estimate of the financial effect cannot be made at this time, while valuations are still being determined,

42 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

fdfdfds

ACCOUNTING POLICIES SECTION 2

Authorisation of financial statements and if such a decline were to occur. Such actions could
statement of compliance with IFRSs include reducing discretionary expenditure and/or
The financial statements of J D Wetherspoon plc implementing price increases.
(the ‘Company’) for the 53 weeks ended 31 July 2022
were authorised for issue by the board of directors on The directors are satisfied that the Company has
6 October 2022, and the balance sheet was signed sufficient resources (eg profitability/liquidity) to
on the board’s behalf by John Hutson and Ben Whitley. withstand adjustments to the base forecast, as well as
the downside scenario.
J D Wetherspoon plc is a public limited company,
incorporated and domiciled in England and Wales. The Company has agreed with its lenders to replace
The Company’s ordinary shares are traded on the normal financial covenant tests with a minimum liquidity
London Stock Exchange. covenant for the period up to and including January
2023, and relaxed leverage covenant tests for the
Basis of preparation second half of the financial year to 30 July 2023. The
The Company’s financial statements have been Company is confident that it will be in a position to
prepared in accordance with the UK-adopted return to normal financial covenant tests thereafter. The
international accounting standards and have been Company has re-financing options available including
prepared in accordance with the requirements of the possible extensions on the revolving credit facility.
Companies Act 2006.
As a result, the directors have satisfied themselves that
The financial statements have been prepared on the the Company will continue in operational existence for
going-concern basis, using the historical cost the foreseeable future. For this reason, the Company
convention, except for the revaluation of financial continues to adopt the going-concern basis in
instruments. preparing its financial statements.

The principal accounting policies adopted by the Important judgements

Company are set out on pages 43–48. The accounting The key judgements made in preparing the financial
policies which follow set out those policies which apply statements are detailed below.
in preparing the financial statements for the year ended
31 July 2022. Hedging
The Company hedge accounts for interest-rate swaps if
These policies have been consistently applied to it meets the specified qualifying criteria outlined by
all of the years presented, unless otherwise stated. IFRS 9. When these criteria are met, the Company is
required to measure the effectiveness of the hedged
Going concern
relationship, which is defined as the extent to which
The directors have made enquiries into the adequacy
changes in the fair value of the interest-rate swap offset
of the Company’s financial resources, through a review
changes in the fair value of the hedged item, being the
of the Company’s budget and medium-term financial
drawdowns of borrowings. Management makes
plan, including capital expenditure plans and cash flow
judgements in forecasting drawdowns of future
forecasts.
borrowings, as well as future interest rates. Changes in
these forecasts may result in all or part of the gain or
The Company has modelled a base forecast in which,
loss, which was originally reported in comprehensive
over the period to 28 January 2024 as it continues to
income, being deemed ineffective and therefore
emerge from the pandemic, sales, profit and cash flow
transferred to the income statement. Once deemed
growth continues. The Company has anticipated within
ineffective, the adjustment cannot be reversed. As
this forecast continued high levels of inflation,
outlined in note 22, hedge ineffectiveness of £8,134k
particularly on food products, wages and repairs.
has been recognised within the income statement in
the period.
A more cautious scenario has been analysed, in which
sales decline by 5% in the next 12 months, compared
The application of the IBOR reform amendments are
with FY19. The Company has reviewed, and is
further discussed on page 37.
satisfied with, the mitigating actions which it could take
Exceptional items
A degree of judgement is required in determining
whether certain transactions merit separate
presentation to allow shareholders to better understand
financial performance in the year, when compared with
that of previous years and trends.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 43

ACCOUNTING POLICIES

Important estimates giving rise to them, merit separate presentation to allow

The areas where the Company has made significant shareholders to better understand the elements of
estimates are listed below. financial performance in the year. This helps to
facilitate comparison with previous years and to better
Impairment of property, plant and equipment assess trends in financial performance. Impairment
The Company recognised impairment charges of charges, reversals of fixed assets and fair value
£26,836k (2021: £4,132k) and impairment reversals of movements in interest-rate swaps are reported as
£3,420k during the period (2021: £Nil). Impairment exceptional, regardless of magnitude, to provide
tests are performed at the end of each reporting period, consistency of treatment with previous
when there are indicators to do so. Impairments are years and a better understanding for the financial
made if future cash flows are lower than the carrying statement’s users.
value of assets. Impairment reversals are made if
future cash flows are higher than the carrying value of Property gains and losses
assets and the previous impairments made. The Company defines property gains and losses as
Management exercises judgement in determining those items of income and expenditure which are the
future cash flows. Assets include property, plant and result of owning and leasing assets which are non-
equipment, right-of-use-assets and other intangible recurring in nature. These include the impairment of
assets. Each pub is treated as a separate cash fixed assets, along with the proceeds and costs from
generating unit. Cash flows are discounted by the the disposal of assets. These items are presented on
Company’s weighted average cost of capital (WACC) the face of the income statement to more clearly
of 10.2% (2021: 8.7%). For leasehold pubs, a show the Company’s underlying performance. The
combination of both the WACC and the internal rate of Company does not consider these costs to be
borrowing (IBR) per specific lease is used. Both WACC operating in nature.
and IBR are independently calculated. In some
instances, management recognises impairment Fixed assets
through obtaining the fair value less costs of disposal Fixed assets include property, plant and equipment,
for an individual pub. On these occasions, external intangible assets and investment properties’. They are
valuations are obtained. all stated at cost, less accumulated depreciation and
any impairment in value.
Sensitivity analysis has been performed to determine
Cost of assets includes acquisition costs, as well as
the theoretical impact on impairment should scenarios
other directly attributable costs in bringing the asset
occur which are alternative to those included within the
into use.
impairment workings. These sensitivities have been
applied to the properties impaired during the period:
Within note 13: property, plant and equipment, fixed
 A 25% reduction of year one future cash flows would
assets are categorised as:
increase the impairment charge by £1,267k.
Asset Description Depreciation policy
 An increase of 0.8% in the WACC would increase
category (straight line)
the impairment charge by £2,582k.
Freehold Land, buildings and Depreciated to their
and long- structural/building estimated residual
The below sensitivity has been applied to the
leasehold improvement values over 50
properties included in the company’s watch list. The
property assets at freehold years. Land is not
determination of the watch list considers both
and long- depreciated.
quantitative and qualitative factors:
leasehold pubs.
 A 25% reduction of year one future cash flows would
increase the impairment charge by £3,438k. Short- Structural/building Depreciated over
leasehold improvement the lease period.
If a previously recognised impairment charge is property assets at leasehold
reversed, the value of the pub will be increased pubs.
to the lower of the book value as if the asset had not Equipment, Assets within pubs Depreciated over 3
been impaired and the future cash flows which the fixtures and including kitchen, to 10 years.
pub would generate. fittings bar and cellar
equipment,
Segmental reporting furniture, IT
The Company operates predominantly one type of software and IT
business (pubs) in the United Kingdom and the hardware.
Republic of Ireland. The company does not separately Assets Assets at sites Assets are not
disclose the results of the hotel business or Republic of under which are not yet depreciated until
Ireland trading given the size, sensitive nature and construction trading and/or they are ready for
level of review by the board. extension works to use.
existing pubs.
Exceptional items
The Company presents, on the face of the income Residual values and useful economic lives are
statement, those items of income and expense which, reviewed and adjusted, if appropriate, at each balance
because of the nature and magnitude of the event sheet date.

44 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 ACCOUNTING POLICIES

Profits and losses on disposal of fixed assets reflect Government grants

the difference between the net selling price and the Monetary and non-monetary resources transferred to
carrying amount at the date of disposal and are the Company by government, government agencies or
recognised in the income statement. similar bodies are recognised at fair value, when the

The carrying value of fixed assets is reviewed annually Company receives the grant. Grants will be recognised
for impairment, with any impairment losses recognised net in the income statement, on a systematic basis,
in the income statement. over the same period during which the expenses, for
which the grant was intended to compensate, are
Assets held for sale recognised.
Where the value of an asset will be recovered through
a sale transaction, rather than continuing use, the asset Grants are disclosed in the note 24 to the accounts on
is classified as held for sale. It is the view of page 41, which discloses government support.
management that the Company is not committed to
selling a site until a contract for sale has been Leases
exchanged. Assets held for sale are valued at the lower The Company has leases for properties across the UK
of book value and fair value, less any costs of disposal, and the Republic of Ireland. There are no other
and are no longer depreciated. material leases recognised under other IFRS 16
categories.
Inventories
Inventories are stated at the lower of cost and net Lessee accounting
realisable value. Cost is calculated on a weighted On completion of a contract (the point at which a
average basis, with net realisable value being the contract becomes legally binding), the Company
estimated selling price, less any costs of disposal. assesses whether the contract is or contains a lease.
Provision is made for obsolete, slow-moving or A lease is present where the contract conveys, over a
damaged inventory, where appropriate. period of time, the right to control the use of an
identified asset in exchange for a consideration.
Bar and food inventory is recognised as an expense
when sold. Non-consumable inventory is recognised as
The lease liability is measured initially at the present
an expense immediately on receipt at a pub or hotel.
value of unavoidable lease payments over the term of
Provisions the lease which in all cases is to the end of the lease.
Provisions are recognised when the Company has These payments are discounted at the Company’s
a present legal or constructive obligation as a result of incremental borrowing rate. For sites at which rent is
a past event and it is probable that an outflow of payable as a percentage of revenue, the lease liability
resources will be required to settle the obligation and is measured at the present value of the unavoidable
a reliable estimate can be made of that minimum guarantee payments over the term of the
obligation’s amount. lease. While any amounts above this minimum amount
will be expensed to the income statement.
Revenue recognition
Revenue is recognised when bar and food products Where a lease is identified, the Company recognises a
are served to customers, after deducting discounts and right-of-use asset and a corresponding lease liability.
sales-based taxes. The lease assets are presented as a separate line in
the balance sheet.
Slot/fruit machine sales are recognised as the net
proceeds taken from the machines, after deducting Leases with terms of under one year are not
gaming duty. capitalised.

Revenue from hotel rooms is recognised when Lessor accounting

rooms are occupied and services are provided, Leases, where the lessor retains substantially all of the
after deduction of discounts and sales-based taxes. asset’s risks and benefits of ownership, are classified
as operating leases. If the operating lease is subject to
The Company operates a gift card scheme – revenue fixed uplifts over the term of the lease, rental payments
from these cards is deferred until the card is redeemed are charged to the income statement on a straight-line
in pubs. basis, over the period of the lease, in line with adopted
accounting standards. If the operating lease is subject
Except for hotel revenue, which is generally received in to open-market rents, rental payments are charged at
advance of occupation, all other payments for goods the prevailing rates.
and services are received at the point of sale.
Leases where the lessor transfers substantially all of
There are no significant judgements or estimations the asset’s risks and benefits of ownership are
made in calculating and recognising revenue. classified as lease assets. This occurs when the
Revenue is not materially accrued or deferred between Company sublets a leasehold site. The lease asset is
one accounting period and the next. measured initially at the present value of lease
receipts, discounted at the Company’s incremental
J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 45
ACCOUNTING POLICIES

borrowing rate. The lease assets are presented as a to assets are met. For the purpose of cash flow
separate line in the balance sheet. reporting, interest paid and received is considered
to be operating cash flows.
Remeasurement
When the Company agrees to a term extension or a Income taxes
change to the minimum payments made under a lease, Current tax assets and liabilities are measured at the
the lease liability or asset will be remeasured on that amount expected to be recovered from, or paid to, the
date; the resulting increase or decrease to the asset or taxation authorities, based on tax rates and laws which
liability will be accounted for with an offsetting are enacted or substantively enacted by the balance
adjustment to the right-of-use asset. Reasurement is sheet date.
completed at the new incremental borrowing rate. Any
remeasurement adjustment which reduces the right-of- Deferred income tax is recognised on all temporary
use asset below zero will be credited to the income differences arising between the tax bases of assets
statement. and liabilities and their carrying amounts in the financial
statements, with the following exceptions:
IFRS 16 Rent concession
The Company has adopted the amendment to IFRS 16  Where the temporary difference arises from an
which provides lessees with an exemption from asset or liability in a transaction which, at the time of
assessing whether a COVID-19 related rent the transaction, affects neither accounting nor
concession is a lease modification. taxable profit or loss.

 Deferred income tax assets are recognised only to

Applying the practical expedient, the Company has
the extent that it is probable that taxable profit will be
recognised the rent forgiveness as a variable lease
available against which the deductible temporary
payment in accordance with IFRS 16. There is a
differences, carried-forward tax credits or tax losses
corresponding adjustment to the lease liability,
can be utilised.
derecognising the part of the lease liability which has
been forgiven, with the corresponding adjustment to Deferred income tax assets and liabilities are
operating expenses. measured at the tax rates which are expected to apply
when the related asset is realised or liability settled,
Where amounts have been deferred they do not based on tax rates and laws enacted or substantively
extinguish the lessee’s liability or substantially change enacted at the balance sheet date.
the consideration of the lease. These have been
accounted for as an increase in the accrual for rent Income tax is charged or credited directly to the
outstanding. income statement, comprehensive income or equity.
The income tax charged or credited will follow the
The Company stopped the application of COVID-19 accounting treatment of the underlying item which has
related rent concession in June 2022. given rise to the income tax charged or credited.

Financial instruments
Right-of-use asset
Financial assets and liabilities are recognised on the
The right-of-use asset comprises the initial
date on which the Company becomes party to the
measurement of the corresponding lease liability, any
contractual provisions of the instrument giving rise to
initial direct costs and the cost of any obligation to
the asset or liability.
restore the site at the end of the lease. They are
subsequently measured at cost less accumulated Financial assets held at amortised cost
depreciation and impairment losses. Right-of-use Financial assets held at amortised cost are non-
assets are depreciated over the term of the lease. derivative financial assets which are held within a
business model where the objective is to collect the
Termination and break of leases contractual cash flow at the same time as the
Where the Company notifies the landlord to purchase contractual terms give rise to cash flows which are
the freehold of a leasehold site, the lease is solely payments of principal and interest. They are
derecognised with any difference in the value of the included in current assets, except for maturities greater
lease liability and the right-of-use asset charged to the than 12 months after the balance sheet date. These
income statement as a property gain or loss. are classified as non-current assets.

Where the Company notifies the landlord of the Other receivables

intention to terminate (break) a lease early, the lease is Other receivables are recognised initially at transaction
remeasured. value and carried at amortised cost less any expected
Borrowing costs credit losses. The Company has a small number of
Borrowing costs are recognised as an expense receivables at any one time; these are generally with
in the period in which they are incurred, unless companies with which the Company has an established
the requirements by the adopted accounting standards trading relationship.
for the capitalisation of borrowing costs relating

46 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 ACCOUNTING POLICIES

Cash and cash equivalents and the Company’s floating-rate borrowings, meaning
Cash and short-term deposits in the balance sheet that floating interest rates paid should be identical to
comprise cash at bank and in hand and short-term those amounts received for a given amount of
deposits. For the purpose of the cash flow statement, borrowings.
cash and cash equivalents comprise cash and
short-term deposits as defined above. Bank overdrafts The Company tests hedge effectiveness prospectively
are shown within current financial liabilities on the using the hypothetical derivative method and compares
balance sheet. Cash and cash equivalents include the changes in the fair value of the hedging instrument
recognition of amounts for cash in transit, including with those in the fair value of the hedged item
electronic card payments not yet receipted as these are attributable to the hedged risk.
highly liquid and low credit risk.
Hedges could be deemed ineffective if the:
Credit risk  Period over which the borrowings were drawn were
Credit risk losses arise when debtors fail to pay their changed. This could result in the borrowings being
obligation to the Company. The Company assesses made at a different floating rate than the interest-rate
credit risk, based on historic experience. The Company swap.
has no significant history of non-payment; as a result,  Gross amount of borrowings were less than the
the expected credit losses on financial assets are not value swapped.
material.  Impact of LIBOR reform were to cause a mismatch
between the interest rate of the swaps and that of the
Financial liabilities company’s debt.
The Company classifies its financial liabilities as other
financial liabilities. These are measured at fair value on The effective element of any gain or loss from
initial recognition and subsequently measured at remeasuring the derivative designated as the hedging
amortised cost, using the effective-interest method. instrument is recognised in other comprehensive
income with the ineffective element recognised
Trade and other payables immediately in the income statement.
These are recognised initially at fair value
and subsequently at amortised cost, using the Hedge accounting is discontinued when the hedge
effective-interest method. expires, is sold, terminated or no longer meets the
Company’s risk management objective.
Bank loans and borrowings
Interest-bearing bank loans and other borrowings are Share capital
recorded initially at fair value of consideration received, Ordinary shares are classified as equity. Incremental
net of direct issue costs. Borrowings are subsequently costs directly attributable to the issue of new shares or
recorded at amortised cost, with any difference options are shown in equity as a deduction, net of tax,
between the amount recorded initially and the from the proceeds.
redemption value recognised in the income statement
over the period of the bank loans, using the effective- When the Company repurchases its own shares,
interest method. the cost of the shares purchased and associated
transaction costs are taken directly to equity and
Bank loans and loan notes are classified as current deducted from retained earnings. The nominal value of
liabilities, unless the Company has an unconditional shares purchased is transferred from share capital to
right to defer settlement of the liability for at least the capital redemption reserve.
12 months after the balance sheet date.
Foreign currencies
Derivative financial instruments Transactions denominated in foreign currencies
and hedging activities are recorded at the rates of exchange prevailing
Derivative financial instruments used by the at the transaction date. Monetary assets and liabilities
Company are stated at fair value on initial recognition are translated at year-end exchange rates, with the
and at subsequent balance sheet dates. resulting exchange differences taken to the income
statement.
Hedge accounting is used to mitigate the Company’s
exposure to variable interest rate risks on borrowings. The Irish branch’s results are translated at the average
Derivatives qualify for hedge accounting only where, at exchange rate for the reporting period; the balance
inception, there is formal designation and sheet is translated at the year-end exchange rate.
documentation of the hedging relationship, there is an Resulting exchange differences are recognised in
economic relationship between the item being hedged comprehensive income.
and the hedging derivative and credit risk does not
dominate the economic relationship. Revaluation gains and losses on the long-term
financing of the Irish branch are recognised in
The Company classifies its interest-rate swap comprehensive income.
derivatives as cash flow hedges, on the basis they
hedge the exposure to variable cash flows. A hedging
ratio of 1:1 is adopted between the interest-rate swaps

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 47

ACCOUNTING POLICIES

Retirement benefits
Contributions to personal pension schemes are Alternative performance measures (APMs)
recognised in the income statement in the period in The Company uses several alternative performance
which they fall due. All contributions are in respect of measures (APM’s) throughout the annual report and
a defined contribution scheme. Once the contributions accounts which are not defined by International
have been paid, the Company has no future payment Financial Reporting Standards (IFRS). APMs are used
obligations. in conjunction with IFRS measures in reporting
financial information and assessing performance, but
Dividends are not given greater prominence. The APMs used
Dividends recommended by the board, but unpaid at have been defined below, alongside reconciliations to
each period end, are not recognised in the financial IFRS measures:
statements until they are paid (in the case of the interim
dividend) or approved by shareholders at the annual  Free cash flow - the calculation of free cash flow is
general meeting (in the case of the final dividend). based on the net cash generated by business activities
and available for investment in new pub developments
Changes in net debt
and extensions to current pubs, after funding interest,
These are both the cash and non-cash movements
corporation tax, lease principal payments, loan issue
of the year, including movements in asset-financing,
costs, all reinvestment in information technology, head
borrowings, cash and cash equivalents.
office and pubs trading at the start of the period
(excluding extensions) and the purchase of own shares
Share-based charges
under the employee share incentive plan. See
The Company has an employee share incentive plan
reconciliation on page 12.
which awards shares to qualifying employees; there is
also a deferred bonus scheme which awards shares to
 Like for like – compares year on year performance of
directors and senior managers, subject to specific
pubs and hotels which were trading in the equivalent
performance criteria.
weeks in both FY22 and FY21.
The cost of the awards in respect of these plans is
measured by reference to the fair value at the date at  Before exceptional items – this measure excludes
which they are granted and is amortised as an expense exceptional items, which are presented separately to
over the vesting period. In assessing the initial fair allow shareholders to better understand financial
value, no account is taken of any vesting conditions, performance in the year, when compared with that of
other than market conditions linked to the price of the previous years and trends. See exceptional items
shares of the Company. reconciliation on page 17.

The Company currently has no other share-based Restatement

transactions. The income tax credit within the Income Statement for
the 52 weeks ended 25 July 2021 has been restated
Shares purchased for share-based payment awards from £13,581k to £17,630k. This is due to the prior year
are held in equity at historic cost, until the awards vest, deferred tax on hedges being incorrectly allocated
when they are transferred to employees. between the other comprehensive income and the
Income Statement.
New accounting standards adopted in the year
 Amendments to IFRS9, IAS39 and IFRS7 The disclosures impacted have been identified
Interest Rate Benchmark Reform (Phase 2) throughout the financial statements. The effect on
 COVID-19 Related Rent Concessions beyond 30 specific financial statement line items within the Income
June 2021 (Amendments to IFRS 16) Statement, Statement of Comprehensive Income and
Balance Sheet are as follows:
New accounting standards in issue but not yet
effective Reported in Restated
52 weeks 52 weeks
New accounting standards and interpretations which ended 25 ended 25
July 2021 Restatement July 2021
are in issue but not yet effective are listed below. The Income Statement1 £000 £000 £000
Company has chosen not to adopt these early: Income tax credit 13,581 4,049 17,630
 Disclosure of Accounting Policies (Amendments to Loss for the period (181,055) 4,049 (177,006)
IAS1 and IFRS Practice Statement 2) Loss per ordinary share – basic (p) (147.4) 3.3 (144.1)
 Classification of Liabilities as Current or Non-current Loss per ordinary share – diluted (p) (147.4) 3.3 (144.1)
(IAS 1)
Statement of Comprehensive Income
 Definition of Accounting Estimates (Amendments to Tax on items taken to OCI (5,084) (4,049) (9,133)
IAS8) Net gain recognised directly in OCI 47,664 (4,049) 43,615
 Deferred Tax related to Assets and Liabilities arising
Balance Sheet
from a Single Transaction (Amendments to IAS12) (15,403) (4,049) (19,452)
Hedging reserve
 Plant and Equipment – Proceeds before Intended Retained earnings (91,256) 4,049 (87,207)
Use (Amendments to IAS16) 1
After exceptional items
 Onerous Contracts – Cost of Fufilling a contract
(Amendments to IAS37)

48 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

fdfdfds
STRATEGIC REPORT

Strategy The Company is focused on reducing annual electricity,

The Company’s strategy is to seek a return on capital gas and water consumption through a combination of
in excess of the cost of the capital which will provide operational initiatives and the introduction of energy-
funds for developments, dividends and reinvestment. efficient technology. This approach will also reduce
carbon emissions.
Business model
The Company operates pubs in the UK and the The Company has an energy and environment group,
Republic of Ireland and aims to sell high-quality which meets regularly, chaired by the finance director,
products, at reasonable prices, in well-maintained Ben Whitley.
premises.
Each pub has an energy, environment and recycling
Business review and future trends
champion, responsible for reducing consumption at his
A review of the Company’s business and the
or her pub and communicating ideas and initiatives to
key measures of its performance, sometimes called
staff. These energy champions help to encourage
key performance indicators (KPIs), can be found in the
changes in behaviour, like using ‘fire up’ and ‘power
chairman’s statement under the financial performance
down’ guides to ensure that pubs minimise energy
section. The chairman’s statement also discusses
consumption when they are closed. Each pub receives
those trends and factors likely to affect the future
a monthly report, detailing the amount of electricity and
development, performance and position of the
gas consumed, highlighting periods of excessive
Company.
consumption and communicating ideas about how to
Social matters reduce consumption.
Wetherspoon provides jobs for over 40,000 people,
paying a reasonable percentage of its profits as bonus Several pieces of energy-saving technology are
for those working in our pubs and head office, training now installed as standard in any new pubs and will be
large numbers of staff and paying a significant retrospectively fitted into existing pubs across the
percentage of our sales as taxes to the government. estate. These include:
 free-air cellar-cooling systems (these cool the cellar
Further information about these policies are published by bringing in outside air, when the external
on: jdwetherspoon.com temperatures are low enough)
 movement-sensor lighting
Environment  LED lighting
The Company is committed to operating ethically and  heat-recovery systems
sustainably and to finding ways, over time, to reduce  Cheetah extraction management systems controlling
our carbon emissions. The Company is committed to ventilation in kitchens
achieve net zero emissions in the UK and Ireland by
2050 and will, if possible, reach this goal sooner. The Company trials new ideas and energy-saving
technology consistently to reduce consumption and
We are currently developing a net-zero road map. In CO2 emissions, these have included:
October 2021 the Company committed to the Science  solar panels
Based Targets initiative for all pub operations and the  rainwater-harvesting systems
global supply chain. Agreeing on science based targets  ground-source-heat pumps
will ensure that the Company follows a credible and  adiabatic cooling systems
scientifically verified carbon-reduction pathway. As part  wind turbines
of the plan we will work with our suppliers, building  building energy management systems (BMS)
designers, equipment providers, employees and other  voltage-optimising equipment
business partners to minimise any effects. The
Company is working with an organisation called With effect from October 2022, all electricity supplied to
Carbon Intelligence and expects to make the the Company’s pubs in the UK, head office, and the UK
submission to the Science Based Targets Initiative in distribution centre will have been generated from 100%
January 2023. In addition, the Company is a Zero renewable sources.
Carbon Forum member, a non-profit-making
organisation which is supporting the hospitality industry Water usage is monitored in pubs and head office.
to comply with government reporting requirements and Where possible, we are installing low-flow or push
implement a roadmap to net-zero carbon emissions. button taps, along with toilets which require less water
to flush. In addition, the Company is trialling data
The Company has been recognised for reducing its management systems which help to pinpoint water
greenhouse gas emissions. It has been listed in the consumption changes which may indicate a change in
2022 FT-Statista Europe’s Climate Leaders list, behaviour or a supply leak.
highlighting companies which, over a five-year period,
have achieved the greatest reduction in emissions. Scope 3 emissions are the largest contributor to the
Company’s overall carbon emissions, representing an
Overall the company has achieved a reduction of estimated 89% of our total output, however measuring
23.6% in Scope 1 and Scope 2 emissions since 2019. carbon emissions in our supply chain is complex.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 49

STRATEGIC REPORT

As our starting point we are allocating carbon To date, the following steps have been taken to reduce
emissions to every product which we sell, including the use of single-use plastics:
food, drinks and hotel rooms. Where detailed data is
not currently available, we are making assumptions  Plastic straws were removed in December 2017 and
based on industry averages. Over time, this data replaced with 100% biodegradable and 100%
quality will improve. Reducing our scope 3 emissions recyclable paper straws and wrappers.
will rely ultimately on a partnership approach with our  Complimentary water fountains available in all pubs,
UK and worldwide suppliers and on their own plans to offering an alternative to plastic water bottles.
reduce carbon emissions.  Plastic containers used in the kitchen are now
reusable.
Pollution and waste  The Company no longer uses cling film.
As a business, we aim to minimise waste and  Plastic milk cartons are segregated and recycled
maximise recycling. Our target is to recycle 95% of separately. Coloured lids have been replaced with clear
recyclable waste. recyclable lids.
 Working with suppliers and with the support of
The pubs and head office segregate waste into a WRAP and the Sustainable Restaurant Association to
minimum of seven streams: glass, tin/cans, cooking oil, reduce and, where possible, remove the use of plastic
paper/cardboard, plastic, lightbulbs and general waste. packaging for food.
In addition, food waste is also separated and sent for
anaerobic digestion. Any remaining non-recyclable The Company does not create any toxic emissions or
waste is sent to waste-to-energy power plants which waste. Electronic waste is disposed of using
reduce CO2 and the use of fossil fuels. No waste is specialised contractors to safely dispose of the items.
sent to landfill.
Where possible, computer equipment is sent suppliers
The Company has a national distribution centre for to refurbish and reuse. Any disposal is compliant with
food, some bottled drinks and non-consumable the EU Waste from Electrical and Electronic Equipment
products. This also includes a recycling centre. When (WEEE) directive.
making deliveries to pubs, lorries collect mixed
recycling, used cooking oil, textiles and aluminium for On construction sites, there is a site waste
return to the recycling centre for processing. management plan, managed by the main contractor
and covering all waste disposal from sites.
During the financial year 2021/22, the pubs sent 10,681
tonnes of waste to the recycling centre, an increase of Human rights
4,723 tonnes, or 79%, on the previous year. The Company is committed to respecting human rights
across our business by complying with all relevant laws
Any unwanted, yet fit-for-consumption, food is donated and regulations. The Company prohibits any form of
to our charity partner FareShare, which distributes it to discrimination, forced, trafficked or child labour and is
food banks, community centres and others in need. committed to safe and healthy working conditions for all
individuals, whether employed by the Company directly
Cooking oil is converted to biodiesel for agricultural or by a supplier in our supply chain.
use.

The volume of paper used to print menus and other

marketing materials has reduced by about 35% in the
last three years, partly through improved management
at pub level and also changing customer habits.

The Company has set the following targets by 2025:

 100% of plastic packaging to be reusable, recyclable
or compostable
 70% of plastic packaging to be effectively recycled or
composted
 30% average recycled content across plastic
packaging
 Action, through redesign, innovation or alternative
(reuse) delivery models, to elimate problematic or
unnecessary single-use plastic items

50 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 STRATEGIC REPORT

Legal and ethical conduct Section 172 statement

The Company has comprehensive measures to meet Section 172 of the Companies Act 2006 requires that
its statutory requirements across all areas of its directors of a Company act in good faith to promote the
operation and also those expected by our customers success of the Company for all stakeholders.
and employees, as necessary, for the long-term
success of the business. Risks in this area can occur In the period, all directors of the Company have acted
from corruption, bribery and human rights abuses, in a manner most likely to achieve the long-term
including discrimination, harassment and bullying. success of the business for its shareholders,
employees, customers, suppliers and the wider
The Company has training programmes for all community in which the Company operates.
employees. It also has a documented whistleblowing
programme, documented processes and procedures In the period, the directors have taken decisions in a
and a supply chain audit programme. number of areas, including: the safe operation of its
pubs and compliance with COVID-19 legislation and
Employees guidance and loan waivers and liquidity.
All employees are encouraged to participate
in the business, some examples of how this is Examples of the Company’s engagement with
achieved being: stakeholders are:
 Several Company initiatives to encourage  Wherever practical, directors consult widely among
employees to suggest small and continuous the Company’s employees, about decisions made
improvements to the running of their pubs about the Company. The directors believe that wide
 ‘Tell Tim’ suggestion scheme for all employees consultation and a management team with extensive
 Pub managers, area managers and other pub industry experience are likely to result in the best long-
employees attending and contributing to weekly term decisions. The Company’s senior management
operations meetings, hosted by the chairman or team regularly engages with pub-based employees
chief executive through meetings, pub visits and surveys.
 Area managers invited to meet the  Most of the Company’s employees are customers
board of directors (before each board meeting) and many are shareholders. The Company encourages
 Regular liaison meetings held with employees, its employees to feed back their views, as well as those
at all levels, to gain feedback on aspects of the of their friends and familiy. The Company operates a
business and ideas for improvement suggestion scheme whereby any employee can send in
 Directors and senior management completing ideas and/or make a recommendation for the
regular visits to pubs – and pub employees regularly improvement of the Company.
visiting head office  Details of the Company’s employment policy are
 The appointment this year of two employee directors disclosed on pages 83-84. Information on employee
to the full board of the Company and two associate engagement can be found above.
employee directors  Where possible, the Company forms long-term
 Weekly e-mail from the chief executive relationships with suppliers, so that all parties have a
to all employees more certain environment in which to operate. The
 Employee-related measures being Company’s responsible retailing policy is published on
part of the pub bonus scheme the website.
 Head-office staff completing regular pub and kitchen  The Company communicates with its customers
shifts (both front of house and in the kitchen) to help through its website and Wetherspoon News. A special
in understanding any staff/customer issues magazine edition of which focuses on press
 Pub employees involved in the decision-making misrepresentations.
process for key business issues  Information on human rights, environmental and
social matters, food safety, cyber security and
reputational matters is provided in this strategic report,
Employee diversity while further information is published on our website.
The table below shows the breakdown of directors,  Information on shareholder engagement is provided
senior managers and employees at the end of the in the corporate governance report. Questions and
period. answers from the interim results investor roadshow
Male Female (March 2022) were published on the Company’s
Directors 7 2 website and the London Stock Exchange Regulatory
Senior managers 558 382 News Service (RNS).
All employees 19,998 22,750

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 51

STRATEGIC REPORT

Principal risks and uncertainties facing the Company

In the course of normal business, the company continually assesses significant risks, categorised based on impact and
likelihood. The following risks, while not intended to be a comprehensive analysis, constitute (in the opinion of the board)
the principal risks and uncertainties currently facing the company.

Business strategy Supply chain disruption

Risk description . Risk description
The Company is aware that, in operating in a There is a risk that we will be unable to supply
consumer-facing business, its business reputation, our pubs with the right products, when they need
built over many years, can be damaged in a them, at a competitive price. All of which are
significantly shorter time frame. The Company fundamental to the success of the company.
faces further risks through the competitive nature
of the industry and the ‘staying in fashion’.
Changes during the year Changes during the year
 Industry is increasingly competitive.  Inflationary pressures across the sector increasing
 Changing consumer habits (post COVID-19, health costs of products.
reasons & cost of living crisis).  Availability of products owing to disruptions in global
markets (eg war, COVID-19, climate change).
Residual risk and impact on the business Residual risk and impact on the business
Failure to execute the right strategy could damage reputation Loss of profits owing to high product prices would reduce
and affect profits. profits. Equally, reputation could be damaged through
availability of items on the menu or passing on cost
increases to customers through price rises.
Risk mitigation Risk mitigation
 Challenging incorrect publications about the Company.  The Company works closely with its suppliers and
 Staying relevant through innovation of offerings in pubs. central distribution partners, in order to maintain
 Key competitor monitoring their offerings and prices. availability of products.
 Regular senior management reviews of strategic  The Company conducts audits of its supply chain.
positioning and performance.  Long-term relationships with suppliers allow savings to
be made through the purchase of large volumes.

Health and safety Legal and regulatory

Risk description Risk description
There is a risk relating to the health and safety of The industry is highly regulated, with frequent
our customers, employees and contractors if increases in alcohol duty and other taxes. There
correct processes are not followed in relation to is a risk that the Company does not comply with
food contamination, equipment failure, harmful regulations or there are breaches of internal
surroundings and hazardous substances (eg policies.
asbestos).
Changes during the year Changes during the year
 Continued focus on food hygiene ratings and overall  Introduction of TCFD reporting requirements.
improvement across the estate.  COVID-19 regulations.
Residual risk and impact on the business Residual risk and impact on the business
Ineffective health and safety practices could result in Non-compliance could result in financial penalties, criminal
prosecution, closure of pubs and reputational damage. prosecution and reputational damage.
Risk mitigation Risk Mitigation
 Food hygiene audits are performed.  In-house legal team who have regular meetings with
 All employees are provided with health and safety the executive team.
training.  Continued update of knowledge on changing
 Pubs are provided with the necessary resources and regulations through training, completion of qualifications
support to ensure that safe working practices are and communication with third party specialists.
maintained.
 Buildings are reviewed for asbestos at the investment
stage.

52 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 STRATEGIC REPORT

Technology, cyber security, data security People

Risk description Risk description
There is a risk of losing key information or Attracting the right people to ensure the
disrupting the operation of the business through Company succeeds, ensuring that our pubs are
system failures, cyber-attacks and internal or sufficiently staffed and retaining key personnel
external data breaches. who hold company knowledge.
Changes during the year Changes during the year
 There have been no material changes during the year.  The market has become increasingly competitive owing
to inflationary pressures on wages.
 Absences due to the impact of COVID-19.
Residual risk and impact on the business Residual risk and impact on the business
Any prolonged or significant failure of these systems could Failure to retain or attract the right people could result in the
pose a risk to trading, including loss of profits and Company being unable to implement its strategies, resulting
reputational damage. in market and reputational risks.
Risk Mitigation Risk mitigation
 The Company seeks to minimise this risk by ensuring  The Company offers bonuses, free shares, long-service
that there are technologies, policies and procedures to awards, paid training, staff discounts and a genuine
ensure protection of hardware, software and opportunity to progress within the business.
information (by various means), including a disaster-  The Company involves the broader senior management
recovery plan, systems of backups and external team in decision-making to provide it with sufficient
hardware and software. exposure, so that, if the need to replace an executive
 The Company continually assesses the risks posed by management team member were to arise there are
cyber threats and makes changes to its technologies, well-qualified internal candidates.
policies and procedures to mitigate identified risks.

Business continuity, crisis management and disaster Liquidity and financing

recovery
Risk description Risk description
There is a risk that unexpected events such as The Company has a risk of being unable to
fires, floods and pandemics will affect the maintain cash flows to meet the needs of the
Company’s ability to operate. business and/or meet its covenants.
Changes during the year Changes during the year
 Continued impact of COVID-19, primarily the Omicron  Waivers on external borrowings have been negotiated
variant in December 2021. with lenders whilst the business recovers post COVID-
 COVID-19 government support no longer available. 19.
 No dividends have been paid or announced in the
financial year.
Residual risk and impact on the business Residual risk and impact on the business
The nature of these risks is outside of the Compay’s control, With insufficient funding, the business may not be able to
therefore without sufficient disaster-recovery plans, the grow in line with plans. Breaches of covenants could result in
impact could be catastrophic. Examples of such impacts financial penalties. Cash-flow may disrupt payment of
could be loss of buildings, people and customers. employees and suppliers, damaging relationships and the
Company’s reputation.
Risk mitigation Risk mitigation
 Mitigating actions taken by the Company will depend on  Sales, profitability, debt requirements and cash flow are
the nature of the event, how much foresight the reviewed weekly by a team which includes the
Company had of the event and the reaction of the chairman, chief executive, finance director and senior
government, business and the public. finance managers
 Comprehensive disaster-recovery plan, seeking to  The Company has dealt with the risks of an increase in
minimise the impact of any such incidents. interest rates by swapping the majority of its floating-
rate borrowings into fixed rates which expire in 2029.

Risk change year on year:

Increased Unchanged Decreased

By order of the board

Nigel Connor
Company Secretary
6 October 2022

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 53

Task Force on Climate-related Financial Disclosures (TCFD)
J D Wetherspoon recognises the risk of climate change and is committed to incorporating the recommendations outlined by the
Task Force on Climate-related Financial Disclosure (TCFD).

This report outlines the assessment performed by management in establishing the key climate-risks and opportunities to the
business which have been identified to date, split by the four TCFD pillars; governance, risk management, strategy and metrics
& targets. Management deems these disclosures to be compliant with TCFD’s recommendations.

Governance
Climate change is an established risk on the Company’s risk register. It is reviewed with prominence equal to that of the
Company’s other risks. The board of directors has overall responsibility for the risk register, which is a permanent item on the
board’s monthly agenda.

The Company’s energy and environment group meets on a fortnightly basis. The Group is chaired by Ben Whitley (Finance
Director). The group tracks the progress of goals and targets, and will monitor the Company’s science-based target plan once
submitted to the Science Based Target initiative (SBTi) by the end of the calendar year. Key initiatives discussed by this focus
group are communicated to the business via environment champions, who are responsible for communicating energy,
environment, waste & recycling best practice back to their pubs. All employees receive training on environmental matters.

Risk management
As mentioned on page 82, the internal audit department is responsible for the day-to-day management of the risk register,
including identifying and assessing of new and current risks. Risks are categorised according to the probability of occurrence
and severity of impact. The internal audit team works alongside risk owners to determine and document mitigations to each of
the Company’s risks.

The Company is a member of the Zero Carbon forum – a group which supports the hospitality sector to meet its carbon
reduction targets. The Company is also working with Carbon Intelligence to develop and implement a robust and credible
carbon reduction strategy through the implementation of science based targets.

Strategy
The Company recognises that it faces both environmental risks and opportunities relating to climate change. To date,
discussions and analysis has focused on, but is not limited to, the following impacts on the business; carbon taxes, availability of
electricity, changes to transport networks, changes in customers’ behaviour, coastal erosion, flooding, supply chain disruption,
availability and pricing of products. Management has disclosed three of these risks and one opportunity. Management assess
the impact of climate charge over the short, medium and long term and estimate the financial impact.

As climate change evolves, management will continue to assess new risks and opportunities, measure against those already
identified, explore potential mitigations, and in the future, consider incorporating into the strategic and financial planning of the
business. The Company deems the current energy saving and consumption reduction ideas in place to be a resilient and
positive start, but will continue to assess the impact and changes required. (See pages 49-50 for details).
Risk/opportunity Impact Risk type Time Financial
horizon impact
Lack of availability of A lack of availability of products would increase costs and Physical/ Medium High risk
products from the supply lower profitability. Any increased costs passed onto the transitional
chain. customer or a reduced availability of products available to
purchase could affect sales.
Increased likelihood of Pub closures would affect the profitability of the Company, Physical Medium Medium risk
flooding from more rain through lower sales, potential insurance premiums and the
and rising sea levels. relocation of staff.
Negative stakeholder Reputational damage could result in fewer customers visiting Transitional Short High risk
perception if J D the pubs and therefore lower sales.
Wetherspoon is seen to The Company may struggle to attract investors, affecting its
not be doing enough to ability to access finance.
tackle climate change.
UK heat waves may result If temperatures were to rise by 2° C or more, produce such as Physical Long Opportunity
in produce typically grown tomatoes, oranges, grapes for wine and more could be grown
in warmer climates being in the UK. This could lower the Company’s carbon footprint
grown closer to home. while reducing produce costs due to less transportation and
import fees.

Key
Risk Type Time horizon Financial Impact2
Physical Risks due to longer-term shifts in climate patterns Long 25 years + High risk >£25m
such as weather disruption. Medium 10-25 years Medium risk £5-25m
Transitional Risks in transitioning to a lower-carbon economy, for Short 0-10 years Low risk <£5m
example new policies or regulations. 2
Annual impact
1
Risk categories defined by the TCFD

Metrics and targets

The energy and environment group is working towards submitting a credible science based target plan to the SBTi (Science
Based Target initiative) by the end of the calendar year, in the future will split by FLAG emissions. The Company is working
towards the Government Net Zero Strategy by 2050 and will provide updates on progress within future reports.

The Company has reported its GHG emissions since 2014. Emission and consumption data can be found on page 68. In the
future, once established, this will include scope 3. A list of the environmental initiatives already under way can be found on
pages 49-50.

54 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF J D WETHERSPOON PLC
Opinion

Our opinion on the financial statements is Conclusions relating to going concern

unmodified
We are responsible for concluding on the
We have audited the financial statements of J D
appropriateness of the directors’ use of the going
Wetherspoon plc (the ‘company’) for the 53 weeks
concern basis of accounting and, based on the audit
ended 31 July 2022, which comprise the Income
evidence obtained, whether a material uncertainty
statement, the Statement of comprehensive income,
exists related to events or conditions that may cast
the Cash flow statement, the Balance sheet, the
significant doubt on the company’s ability to continue
Statement of changes in equity and notes to the
as a going concern. If we conclude that a material
financial statements, including a summary of significant
uncertainty exists, we are required to draw attention in
accounting policies. The financial reporting framework
our report to the related disclosures in the financial
that has been applied in their preparation is applicable
statements or, if such disclosures are inadequate, to
law and UK-adopted international accounting
modify the auditor’s opinion. Our conclusions are
standards.
based on the audit evidence obtained up to the date of
In our opinion, the financial statements:
our report. However, future events or conditions may
 give a true and fair view of the state of the
cause the company to cease to continue as a going
company’s affairs as at 31 July 2022 and of its profit for
concern.
the 53 weeks then ended;
 have been properly prepared in accordance with UK-
A description of our evaluation of management’s
adopted international accounting standards; and
assessment of the ability to continue to adopt the going
 have been prepared in accordance with the
concern basis of accounting, and the key observations
requirements of the Companies Act 2006.
arising with respect to that evaluation is included in the
Basis for opinion Key Audit Matters section of our report.
We conducted our audit in accordance with
Based on the work we have performed, we have not
International Standards on Auditing (UK) (ISAs (UK))
identified any material uncertainties relating to events
and applicable law. Our responsibilities under those
or conditions that, individually or collectively, may cast
standards are further described in the ‘Auditor’s
significant doubt on the company’s ability to continue
responsibilities for the audit of the financial statements’
as a going concern for a period of at least twelve
section of our report. We are independent of the
months from when the financial statements are
company in accordance with the ethical requirements
authorised for issue.
that are relevant to our audit of the financial statements
in the UK, including the FRC’s Ethical Standard as In auditing the financial statements, we have concluded
applied to listed public interest entities, and we have that the directors’ use of the going concern basis of
fulfilled our other ethical responsibilities in accordance accounting in the preparation of the financial
with these requirements. We believe that the audit statements is appropriate.
evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion. In relation to the company’s reporting on how it has
applied the UK Corporate Governance Code, we have
nothing material to add or draw attention to in relation
to the directors’ statement in the financial statements
about whether the directors considered it appropriate to
adopt the going concern basis of accounting.

The responsibilities of the directors with respect to

going concern are described in the ‘Responsibilities of
directors for the financial statements’ section of this
report.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 55

INDEPENDENT AUDITORS’ REPORT

Our approach to the audit

Overview of our audit approach

Overall materiality: £5,000,000, which represents 0.29% of the company’s

revenue.

Key audit matters were identified as:

Key audit
Materiality
matters
 The impairment of property, plant and equipment and right of use
assets (same as previous period); and
 Going concern (in the prior year this was included as a matter
Scoping
described in the ‘Material uncertainty related to going concern’
section).

Our auditor’s report for the 52 weeks ended 25 July 2021 included the
following matters which have not been reported as a key audit matter in our
current period’s audit report:

 Management override of controls – the presentation of exceptional

items; and
 The application of International Financial Reporting Standard (IFRS)
16 “Leases”.

Management override of control - the presentation of exceptional items

remains a significant risk. However, due to a decrease in the level of
judgement in relation to those items included as exceptional items, this is no
longer identified as a key audit matter.
The application of International Financial Reporting Standard (IFRS) 16
“Leases” was included as a key audit matter in the previous period due to the
identification of a prior period adjustment in respect of 2020 and the impact of
rental concessions granted in relation to the Covid-19 pandemic. We do not
consider these items to be a significant risk in the current year.

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the
financial statements of the current period and include the most significant assessed risks of material misstatement
(whether or not due to fraud) that we identified. These matters included those that had the greatest effect on: the overall
audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. These matters
were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon,
and we do not provide a separate opinion on these matters.

Description Audit reponse

KAM

Our results / Key

Disclosures observations

56 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 INDEPENDENT AUDITORS’ REPORT

In the graph below, we have presented the key audit matters, significant risks and other risks relevant to the audit.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 57

INDEPENDENT AUDITORS’ REPORT

Key Audit Matter How our scope addressed the matter

The impairment of property, plant and In responding to the key audit matter, we performed the following
equipment (“PPE”) and right of use assets audit procedures:
(“ROU assets”)  Considering the accounting policy for compliance with IAS 36 and
that the application by the company is consistent with the stated
We identified impairment of PPE and ROU policy;
assets as one of the most significant assessed  Assessing the design effectiveness of controls, including the
risks of material misstatement due to error. methodology applied by management to identify indicators of
impairment and when performing their impairment test for each of the
PPE represents the largest balance on the
relevant pubs;
balance sheet (31 July 2022: £1.4bn / 25 July
 Understanding and challenging management on the approach to
2021: £1.4bn). Further to this, there are ROU
creating the watchlist and challenging management on its
assets recognised which must be considered for
completeness, including any pubs which are performing below the
impairment (31 July 2022: £0.4bn / 25 July
remainder of the estate since returning to a more “normal” trading
2021: £0.5bn).
period;
The directors consider each individual pub to be  Recalculating the arithmetical accuracy and integrity of
a separate cash generating unit. The directors management’s impairment model, by checking the internal
are required to undertake an impairment consistency of formulae and performing sample checks on the inputs
assessment where events indicate that the and assumptions made in managements model to identify indicators
carrying value of the cash generating unit may of impairment;
not be recoverable.  Validating that the methodology of the impairment exercise is
consistent with the requirements of IAS36 Impairment of Assets,
The process for measuring and recognising including appropriate identification of CGUs and the allocation of costs
impairment under International Accounting in the value in use calculations;
Standard (IAS) 36 ‘Impairment of Assets’ is  Agreeing a sample of impairment model inputs to supporting
complex and requires significant judgement, documentation, including lease agreements, historic pub profit figures
including assumptions within management’s and the fixed asset register;
assessment of the impact of the geopolitical and  Engaging our internal valuation experts to independently calculate
cost of living factors on future trading activity for the discount rate and compare it to the discount rate applied in the
each pub, the determination of the appropriate models by management;
discount rate to be applied to those cashflows,  Identifying pubs with declining profits from our revenue testing
as well as the valuation of properties. which could have indicators of impairment;
Management identify pubs which have an  Comparing management’s assumptions within the impairment
indicator of impairment (management’s model against external economic forecasts reflecting the uncertainties
“Watchlist” of pubs) and management then risk inherent within the current economic environment;
rate the Watchlist of pubs into “moderate” and  Obtaining management’s risk categorisation between ‘high-risk’
“high risk” based on recent trading performance. and ‘moderate-risk’ pubs and ensuring the correct classification of
Our significant risk has been pinpointed to those pubs in the impairment review and consistency between periods;
pubs classified as high risk on management’s  Obtaining corroborative evidence to support management’s
“Watchlist” of pubs. judgements used for those pubs with indicators of impairment, with
special audit consideration on pubs classified as “high risk” including
Relevant disclosures in the Annual Report evidence for changes made to the pubs, discussions with pub
and Financial Statements 2022 managers / area managers, review of pub space and plans and
 Financial Statements: Note 13, PPE evidence for changes made to operations;
 Accounting Policies: Important estimates,  Performing sensitivity analysis based on reasonably possible
Impairment of PPE changes to key assumptions determined by management being the
 Corporate Governance: Significant financial discount and cost inflation rates; and
reporting items.  Assessing the disclosures in the notes to the financial statements
against the requirements of IAS 36 Impairment of Assets, in particular
the requirement to disclose further sensitivities for CGUs where a
reasonably possible change in a key assumption would cause an
impairment.

Key observations
We identified that additional immaterial impairments were required in
relation to the impairment of PPE and ROU assets.

58 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 INDEPENDENT AUDITORS’ REPORT

Key Audit Matter How the scope addressed the matter

Going concern In responding to the key audit matter, we performed the following
We identified going concern as a significant risk audit procedures:
due to the ongoing impact of Covid-19,  obtained and challenged management’s base case forecast for the
geopolitical and inflationary cost pressures on period to 28 January 2024, together with supporting evidence for all
current and forecast trading performance, key trading, working capital and cash flow assumptions;
liquidity levels and covenant compliance and the  obtained and challenged management’s downside scenario, which
challenges these factors present to reflects a reasonably possible sales decline and management’s
management when preparing their going response via controllable mitigating actions;
concern assessment.  tested the clerical accuracy of management’s assessment,
including forecast liquidity and covenant compliance under
In addition to this, as auditors, we are required
management’s base and downside scenarios;
to “obtain sufficient appropriate audit evidence
 assessed the robustness of forecasts prepared by comparison to
about the appropriateness of management's use
forecasts made in prior periods, including assessing management’s
of the going concern assumption in the
historic ability to forecast, and in light of our understanding of the
preparation and presentation of the financial
company’s operations;
statements and to conclude whether there is a
 following our review of management’s board memorandum, we
material uncertainty about the entity's ability to
identified the areas of business operations which could be most
continue as a going concern” (ISA (UK) 570).
affected by rising costs and sought evidence to corroborate
Management has modelled a base case management’s attempts to quantify the potential impact. We also
forecast in which, over the period to 28 January sought evidence to support that the mitigating actions highlighted by
2024 as it continues to emerge from the management would be achievable and effective;
pandemic, sales, profit and cash flow growth  applied professional scepticism in performing our own independent
continues. Management have anticipated within reverse stress test of management’s cash flow forecast models and
this forecast continued high levels of inflation, their impact on forecast liquidity and banking covenants to identify
particularly on food products, wages and under what circumstances the company’s covenants and liquidity
repairs. would be compromised, and whether the scenario has no more than a
remote possibility of occurring;
A more cautious “downside” scenario has been  obtained correspondence in relation to covenant waivers and
analysed, where sales decline by 5% in the 52 amendments and confirmed that the terms and conditions therein
weeks ending 30 July 2023, compared to last were consistent with those applied by management in their base case
comparable full trading period pre the pandemic and downside scenario forecasts, including the period over which the
and then converges with the base case for the banks have confirmed that these waivers and amendments are in
remainder of the going concern period to 28 place; and
January 2024. The company has reviewed, and  assessed the disclosures made within the financial statements for
is satisfied with, the mitigating actions it could consistency with management’s assessment of going concern and
take if such a decline were to occur. Such whether they are in line with the accounting standards.
actions could include reducing discretionary
expenditure and/or implementing price Key observations
increases. We have nothing to report in addition to that stated in the ‘Conclusions
The company has two EBITDA-related relating to going concern’ section of our report.
covenants attached to two of their debt facilities, .
the RCF and USPP loan. These covenants .
have been waived until the end of January 2023
(Q2 FY23), with the first forecast assessment
period set to be the end of April 2023 (Q3 FY23)
albeit at a reduced level to normal covenant
levels. Covenants will return to normal levels
from the end of the October 2023 (Q1 FY24).

Relevant disclosures in the Annual Report

and Financial Statements 2022
 The company’s accounting policy on going
concern is shown in ‘accounting policies’ to the
financial statements on page 43.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 59

INDEPENDENT AUDITORS’ REPORT

Our application of materiality

We apply the concept of materiality both in planning and performing the audit, and in evaluating the effect of identified
misstatements on the audit and of uncorrected misstatements, if any, on the financial statements and in forming the
opinion in the auditor’s report.

Materiality was determined as follows:

Materiality measure Company

Materiality for We define materiality as the magnitude of misstatement in the financial

financial statements statements that, individually or in the aggregate, could reasonably be expected to
as a whole influence the economic decisions of the users of these financial statements. We
use materiality in determining the nature, timing and extent of our audit work.

Materiality threshold £5,000,000, which is 0.29% of revenue.

Significant judgements In determining materiality, we made the following significant judgements:

made by auditor in
determining the  We evaluated a range of benchmarks, including revenue, profit before tax and
materiality total assets. We consider revenue to be the most appropriate benchmark given
the recent volatility of earnings and we selected a percentage at the lower end of
our acceptable range. This represents a change from the prior year when
materiality was based on a 3 year average of profit / (loss) before tax.

Materiality for the current period is lower than we determined for the period ended
25 July 2021. We lowered materiality as we did not consider an increase from the
prior year and / or pre-Covid levels to be appropriate given profitability has not yet
returned to pre Covid-19 levels. The materiality was consistent with 2019
materiality, the last normal period of trading prior to Covid-19.

Performance We set performance materiality at an amount less than materiality for the
materiality used to financial statements as a whole to reduce to an appropriately low level the
drive the extent of our probability that the aggregate of uncorrected and undetected misstatements
testing exceeds materiality for the financial statements as a whole.

Performance materiality £3,750,000, which is 75% of financial statement materiality.

threshold

Significant judgements In determining performance materiality, we made the following significant

made by auditor in judgements;
determining the
performance materiality  Whether there were any significant adjustments made to the financial
statements in prior years

 Whether there were any significant control deficiencies identified in prior years

 Whether there were any changes in senior management during the period

 Whether there were any significant changes in business objectives/strategy

Specific materiality We determine specific materiality for one or more particular classes of
transactions, account balances or disclosures for which misstatements of lesser
amounts than materiality for the financial statements as a whole could reasonably
be expected to influence the economic decisions of users taken on the basis of
the financial statements.

Specific materiality We determined a lower level of specific materiality for certain specific areas,
being directors’ remuneration and related party transactions.

60 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 INDEPENDENT AUDITORS’ REPORT

Materiality measure Company

Communication of We determine a threshold for reporting unadjusted differences to the audit

misstatements to the committee.
audit committee

Threshold for £250,000 and misstatements below that threshold that, in our view, warrant
communication reporting on qualitative grounds.

The graph below illustrates how performance materiality interacts with our overall materiality and the tolerance for
potential uncorrected misstatements.

Overall materiality

FSM: Financial statements materiality

Revenue PM: Performance materiality
£1.74bn PM
£3.750m,
75% TFPUM: Tolerance for potential uncorrected
FSM
£5.0m, misstatements
0.29%

TFPUM
£1.250m, 25%

An overview of the scope of our audit

We performed a risk-based audit that requires an understanding of the company’s business and in particular matters
related to:

Understanding the company and its environment, including controls

The engagement team obtained an understanding of the company and its environment, including the controls and the
assessed risks of material misstatement. We performed interim and advanced audit procedures as well as an evaluation
of the internal control environment, including the company’s IT systems and controls.

Performance of the audit

We performed the majority of our work on-site and undertook substantive testing on significant transactions and material
account balances, including the procedures outlined above in relation to key audit matters. There were no significant
changes to the scope of the audit compared to the prior period audit.

Other information
The directors are responsible for the other information. The other information comprises the information included in the
Annual Report and Financial Statements, other than the financial statements and our auditor’s report thereon. Our
opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly
stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the financial statements or our knowledge
obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or
apparent material misstatements, we are required to determine whether there is a material misstatement in the financial
statements or a material misstatement of the other information. If, based on the work we have performed, we conclude
that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 61

INDEPENDENT AUDITORS’ REPORT
Our opinions on other matters prescribed by the Companies Act 2006 are unmodified

In our opinion, the part of the directors’ remuneration report to be audited has been properly prepared in accordance
with the Companies Act 2006.

In our opinion, based on the work undertaken in the course of the audit:
 the information given in the strategic report and the directors’ report for the financial year for which the financial
statements are prepared is consistent with the financial statements and those reports have been prepared in accordance
with applicable legal requirements;
 the information about internal control and risk management systems in relation to financial reporting processes and
about share capital structures, given in compliance with rules 7.2.5 and 7.2.6 in the Disclosure Rules and Transparency
Rules sourcebook made by the Financial Conduct Authority (the FCA Rules), is consistent with the financial statements
and has been prepared in accordance with applicable legal requirements; and
 information about the company’s corporate governance code and practices and about its administrative, management
and supervisory bodies and their committees complies with rules 7.2.2, 7.2.3 and 7.2.7 of the FCA Rules.

Matters on which we are required to report under the Companies Act 2006
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit,
we have not identified material misstatements in:
 the strategic report or the directors’ report; or
 the information about internal control and risk management systems in relation to financial reporting processes and
about share capital structures, given in compliance with rules 7.2.5 and 7.2.6 of the FCA Rules.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to
report to you if, in our opinion:
 adequate accounting records have not been kept, or returns adequate for our audit have not been received from
branches not visited by us; or
 the financial statements and the part of the directors’ remuneration report to be audited are not in agreement with the
accounting records and returns; or
 certain disclosures of directors’ remuneration specified by law are not made; or
 we have not received all the information and explanations we require for our audit; or
 a corporate governance statement has not been prepared by the company.

Corporate governance statement

The Listing Rules require us to review the directors' statement in relation to going concern, longer-term viability and that
part of the Corporate Governance Statement relating to the company’s compliance with the provisions of the UK
Corporate Governance Code specified for our review.

Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the
Corporate Governance Statement is materially consistent with the financial statements, or our knowledge obtained
during the audit:
 the directors’ statement in the financial statements about whether the directors considered it appropriate to adopt the
going concern basis of accounting in preparing the financial statements and the directors’ identification of any material
uncertainties to the company’s ability to continue to do so over a period of at least twelve months from the date of
approval of the financial statements.
 the directors’ explanation in the Annual Report and Financial Statements as to how they have assessed the prospects
of the company, over what period they have done so and why they consider that period to be appropriate, and their
statement as to whether they have a reasonable expectation that the company will be able to continue in operation and
meet its liabilities as they fall due over the period of their assessment, including any related disclosures drawing attention
to any necessary qualifications or assumptions;
 the directors’ statement that they consider the annual report and financial statements taken as a whole is fair,
balanced and understandable and provides the information necessary for shareholders to assess the company’s
performance, business model and strategy;
 the directors’ confirmation in the annual report that they have carried out a robust assessment of the principal and
emerging risks facing the company including the impact of Covid-19 and the disclosures in the annual report that
describe the principal risks, procedures to identify emerging risks and an explanation of how they are being managed or
mitigated including the impact of Covid-19;
 the section of the annual report that describes the review of the effectiveness of the company’s risk management and
internal control systems, covering all material controls, including financial, operational and compliance controls; and
 the section of the annual report describing the work of the audit committee, including significant issues that the audit
committee considered relating to the financial statements and how these issues were addressed.

62 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 INDEPENDENT AUDITORS’ REPORT

Responsibilities of directors for the financial statements

As explained more fully in the directors’ responsibilities statement, the directors are responsible for the preparation of the
financial statements and for being satisfied that they give a true and fair view, and for such internal control as the
directors determine is
necessary to enable the preparation of financial statements that are free from material misstatement, whether due to
fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company’s ability to continue as a
going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic
alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with
ISAs (UK) will always detect a material misstatement when it exists.

Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting
Council’s website at: www.frc.org.uk/auditorsresponsibilities. The description forms part of the auditor’s report.

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line
with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud.
Owing to the inherent limitations of an audit, there is an unavoidable risk that material misstatements in the financial
statements may not be detected, even though the audit is properly planned and performed in accordance with ISAs
(UK).
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below:

 We obtained an understanding of legal and regulatory frameworks applicable to the company and the industry in
which it operates through review of prior year financial statements, enquiries of management, the finance team, Head of
Legal and the Audit Committee. We determined that the following laws and regulations were most significant: UK-
adopted international accounting standards, IFRIC Interpretations, Companies Act 2006, Listing Rules and the UK
Corporate Governance Code;
 We enquired of management and the board of directors whether they were aware of any instances of non-
compliance with laws and regulations and whether they had any knowledge of actual, suspected alleged fraud;
 We enquired of management, the finance team, Head of Legal and the Audit Committee about the company’s policies
and procedures relating to the identification, evaluation and compliance with laws and regulations and the detection and
response to the risks of fraud and the establishment of internal controls to mitigate risks related to fraud or non-
compliance with laws and regulations;
 We obtained an understanding of how the company is complying with those legal and regulatory frameworks by
making enquiries of management, those responsible for legal and compliance procedures and the company secretary.
Our findings were corroborated by review of the board minutes and papers provided to the audit committee and a
review of HMRC correspondence;
 We assessed the susceptibility of the company’s financial statements to material misstatement, including how fraud
might occur. Audit procedures performed by the engagement team included:
- Obtaining an understanding of how those charged with governance considered and addressed the potential
for override of controls or other inappropriate influence over the financial reporting process;
- Challenging assumptions and judgements made by management in its significant accounting estimates;
- Identifying and testing journal entries with a focus on journals indicating large or unusual transaction or
account combinations based on our understanding of the business, including material journal entries
impacting the profit and loss accounts as well as journal entries posted by key management personnel;
- Applying audit data analytics techniques across the revenue population to match revenue recorded to cash
receipts and investigating and corroborating any expected exceptions;
- Applying audit data analytics techniques across the costs of goods sold population to match revenue recorded
to cost of goods sold and investigating and corroborating any expected exceptions;
- Assessing matters reported through the company’s whistleblowing programme and the results of
management’s investigation of such matters; and
-

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 63

INDEPENDENT AUDITORS’ REPORT

- Identifying and assessing the design effectiveness of controls management has in place to prevent and detect
fraud.
 These audit procedures were designed to provide reasonable assurance that the financial statements were free from
fraud or error. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one
resulting from error and detecting irregularities that result from fraud is inherently more difficult than detecting those that
result from error, as fraud may involve collusion, deliberate concealment, forgery or intentional misrepresentations. Also,
the further removed non-compliance with laws and regulations is from events and transactions reflected in the financial
statements, the less likely we would become aware of it;
 The engagement partner assessed the appropriateness of the collective competence and capabilities of the
engagement team, by considering the engagement team’s understanding of, and practical experience with, audit
engagements of a similar nature and complexity;
 We communicated relevant laws and regulations and potential fraud risks to all engagement team members and
remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

Other matter which we required to address

Following the recommendation of the audit committee, we were appointed by the board on 9 November 2017 to audit
the financial statements for the period ended 29 July 2018 and subsequent financial periods.

The period of total uninterrupted engagement including previous renewals and reappointments of the firm is 5 years,
covering the periods ended 29 July 2018 to 31 July 2022.

The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the company and we remain
independent of the company in conducting our audit.

Our audit opinion is consistent with the additional report to the audit committee.

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those
matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted
by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a
body, for our audit work, for this report, or for the opinions we have formed.

Marc Summers BSc (Hons) FCA

Senior Statutory Auditor
for and on behalf of Grant Thornton UK LLP
Statutory Auditor, Chartered Accountants
London
6 October 2022

64 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

DIRECTORS AND OFFICERS
A founder-led company with a combined executive board experience of 86 years.
Tim Martin, Chairman, aged 67 John Hutson, Chief Executive Officer, aged 57
Founded the Company in 1979, having previously studied law at Joined in 1991 and was appointed to the board in 1996. He is a
Nottingham University and qualified as a barrister. He became graduate of Exeter University.
chairman in 1983. Ⓑ Ⓜ
Ⓑ
EXECUTIVE BOARD

Su Cacioppo, Personnel and Legal Director, aged 55 Ben Whitley, Finance Director, aged 44
DIRECTORS

Joined in 1991 and was appointed to the board in 2008. She is a Joined in 1999 and was appointed to the board in 2015. He is a
graduate of South Bank University and London Guildhall graduate of Durham University and qualified as a chartered
University. management accountant in 2012.
Ⓑ Ⓜ Ⓑ Ⓜ
James Ullman, Personnel and Retail Auditor Director, aged 51
Joined in 1994 and was appointed to the board in 2022. He is a
graduate of Brighton University and Birmingham City University.
He became a chartered internal auditor in 2011.
Ⓑ Ⓜ
Hudson Simmons, Employee Director, aged 50 Debbie Whittingham, Employee Director, aged 53
DIRECTORS
EMPLOYEE

Joined in 1997 and was appointed to the board in 2021 and is Joined in 1992 and was appointed to the board in 2021. She is
PEOPLE

area manager for the Sheffield area. He is a graduate of regional manager for the West Midlands.
Nottingham Trent University. Ⓑ
Ⓑ
Ben Thorne, Senior Independent Director, aged 63 Debra van Gene, Non-Executive Director, aged 68
Appointed to the board in 2020. He is a graduate of Westminster Appointed to the board in 2006 and is chair of the remuneration
University. He qualified as a solicitor in 1985. He is managing committee. She is a graduate of Oxford University. She has
director at WH Ireland. previously been a partner at Heidrick and Struggles Inc and a
Ⓑ Ⓐ Ⓝ Ⓡ commissioner with the Judicial Appointments Commission.
NON-EXECUTIVE
DIRECTORS

Ⓑ Ⓐ Ⓝ Ⓡ
Harry Morley Non-Executive Director, aged 57 Sir Richard Beckett, Non-Executive Director, aged 78
Appointed to the board in 2016 and is chair of the audit committee. Appointed to the board in 2009 and is chair of the nomination
He is a graduate of Oxford University. He is a non-executive committee. He was called to the bar in 1965 and took silk in 1987.
director of The Mercantile Investment Trust plc, TheWorks.co.uk He was one of the pre-eminent practitioners in regulatory and
plc and of Cadogan Group. He is a trustee of the Ascot Authority. licensing matters.
He qualified as a chartered accountant in 1991. Ⓑ Ⓐ Ⓝ Ⓡ
Ⓑ Ⓐ Ⓝ Ⓡ
Nigel Connor, Company Secretary and Legal Director, aged 53 David Capstick, IT and Property Director, aged 61
Joined in 2009 and was appointed company secretary in 2014. He Joined in 1998 and appointed to the management board in 2003.
is a graduate of Newcastle University and qualified as a solicitor in He is a graduate of the University of Surrey.
1997. Ⓜ
Ⓑ Ⓜ Martin Geoghegan, Operations Director, aged 53
Michael Barron, Commercial Director, aged 36 Joined in 1994 and appointed as operations director in 2004.
MANAGEMENT

Joined in 2011 and appointed to the management board in 2022. Ⓜ

He is a graduate of Sheffield University and qualified as a
BOARD

Tom Ball, People Director, aged 46

chartered accountant in 2010.
Joined in 2009 and appointed to the management board in 2022.
Ⓜ He is a graduate of Bournemouth University.
Paul Brimmer, Purchasing Director, aged 47 Ⓜ
Joined in 2006 and appointed to the management board in 2022. Hannah Young, Deputy Finance Director, aged 41.
He became a member of the Chartered Institute of Procurement Joined in 2013 and appointed to the management board in 2022.
and Supply in 2002. She is a graduate of Bristol University and qualified as a chartered
Ⓜ management accountant in 2006.
Ⓜ
Will Fotheringham, Associate Employee Director, aged 48 Emma Gibson, Associate Employee Director, aged 36
DIRECTORS
ASSOCIATE

Joined in 1998. Appointed as an associate employee director in Joined in 2004. Appointed as an associate employee director in
2021. He is general manager for the north west England and north 2021. She is pub manager of The Imperial, Exeter.
Wales.

Key
Ⓑ Board Ⓜ Management Ⓐ Audit Ⓝ Nomination Ⓡ Remuneration
member board committee committee committee

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 65

 DIRECTORS’ REPORT
Directors Any borrowings, including accrued interest, will become
The directors of the Company who were in office immediately repayable on such lapse.
during the year and up to the date of signing
the financial statements are listed on page 65. There are no other significant agreements to which
the Company is party which may be subject to change-
Dividends of-control provisions.
No dividend will be paid for the year.
There are no agreements with the Company’s
Return of capital directors or employees which provide for compensation
At the annual general meeting of the Company, held on for loss of office or employment which occurs because
18 November 2021, the Company was given authority of a takeover bid.
to make market purchases of up to 19,312,523 of its
own shares. During the year to 31 July 2022, we Statement of directors’ responsibilities
purchased 1,396,204 shares for share-based The directors are responsible for preparing the annual
payments. report, the directors’ remuneration report and the
financial statements, in accordance with applicable law
Directors’ interest in contracts and regulations.
No director has any material interest in any contractual
agreement, other than an employment contract, Company law requires the directors to prepare financial
subsisting during or at the end of the year, which is, statements for each financial year. Under that law, the
or may be, significant to the Company. directors have prepared the financial statements in
accordance with the UK-adopted international
Takeover directive disclosures accounting standards and have been prepared in
The Company has an authorised share capital accordance with the requirements of the Companies
comprising 500,000,000 ordinary shares of 2p each. Act 2006. Under company law, the directors must not
As at 31 July 2022, the total issued share capital approve the financial statements, unless they are
comprised 128,750,155 fully paid-up shares of 2p satisfied that they give a true, fair and balanced view of
each. The rights to these shares are set out in the the state of affairs of the Company and of the profit or
Company’s articles of association. There are loss of the Company for that period. In preparing these
no restrictions on the transfer of these shares financial statements, the directors are required to:
or their attached voting rights.
 select suitable accounting policies and
Details of significant shareholdings at year end then apply them consistently
and as at 31 July 2022 are given on page 85.  make judgements and accounting estimates
which are reasonable and prudent
No person holds shares with specific rights regarding  state whether applicable UK-adopted international
control of the Company. accounting standards (IASs) in accordance with the
requirements of the Companies Act 2006 have been
The Company operates an employee share incentive followed, subject to any material departures disclosed
plan. However, no specific rights with respect to the and explained in the financial statements
control of the Company are attached to these shares.  prepare the financial statements on the going-
In addition, the Company operates a deferred concern basis, unless it is inappropriate to presume
bonus scheme, whereby, should a takeover occur, that the Company will continue in business
all shares held in trust would be transferred to the
employee immediately. The directors are responsible for keeping adequate
accounting records which are sufficient to show and
The Company is not aware of any agreements among explain the Company’s transactions and disclose with
holders of securities known to the Company which may reasonable accuracy at any time the financial position
result in restrictions on the transfer of securities or of the Company and to enable them to ensure that the
voting rights. financial statements and the directors’ remuneration
report comply with the Companies Act 2006 and article
The Company has the power to issue and buy back 4 of the IAS regulation. They are also responsible for
shares as a result of resolutions passed at the safeguarding the assets of the Company and hence for
annual general meeting in 2021. It is the Company’s taking reasonable steps for the prevention and
intention to renew these powers; the resolutions detection of fraud and other irregularities.
approving them are found in the notice of the
annual general meeting for 2022.

In the event of a change of control, the Company is

obliged to notify its main bank lenders. The lenders
shall not be obliged to fund any new borrowing
requests; facilities will lapse 10 days after the change
of control, if the terms on which they can continue have
not been agreed on.

66 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 DIRECTORS’ REPORT

The directors confirm that: Viability statement

In accordance with provision 31 of the UK Corporate
 so far as each director is aware, there is no relevant
Governance Code 2018, the directors confirm that they
audit information of which the Company’s auditor is
have a reasonable expectation that the Company will
unaware
continue to operate and meet its liabilities, as they fall
 the directors have taken all the steps which they due, until the financial year in 2025.
ought to have taken as directors to make themselves
aware of any relevant audit information and to establish The directors have determined that a three-year
that the Company’s auditor is aware of that information. period is an appropriate period over which to assess
viability, as it aligns with the Company’s capital
The directors are responsible for preparing the annual investment plans and gives a greater certainty over the
report in accordance with applicable law and forecasting assumptions used.
regulations. The directors consider that the annual
report and financial statements, taken as a whole, The directors’ assessment has been made with
provide the information necessary to assess the reference to the Company’s current position, financial
Company’s performance, business model and strategy plan and its principal risks and uncertainties set out on
and are fair, balanced and understandable. pages 52–53, specifically economic, regulatory,
The directors are responsible for the maintenance and reputational and interest-rate risks. To assess the
integrity of the corporate and financial information impact of the Company’s principal risks and
included on the Company’s website. Legislation in the uncertainties on its long-term viability, scenarios were
United Kingdom governing the preparation and applied to the Company’s financial forecasts in the form
dissemination of financial statements may differ from of reduced like-for-like sales compared to FY19 . It is
legislation in other jurisdictions. assumed that the Company’s financial plans would be
adjusted in response, such actions could include
To the best of our knowledge: reducing discretionary expenditure and/or
implementing price increases.
 the Company’s financial statements are prepared in
accordance with the UK-adopted international The Company has Revolving Credit Facilities in place
accounting standards and have been prepared in of £875m until February 2024 and £855m until
accordance with the requirements of the Companies February 2025. The company has re-financing options
Act 2006; and available including possible extensions on the
Revolving Credit Facility.
 the strategic report and directors’ report include a fair
In making this statement, the directors carried out
review of the development and performance of the
a robust assessment of the principal risks and
business and the position of the Company, together
uncertainties facing the Company, including those
with a description of the principal risks and
which would threaten its business model, future
uncertainties which it faces.
performance, solvency or liquidity. Principal risks and
Business relations uncertainties set out on pages 52–53 are the
Information on the Company’s relations with customers result of internal risk management and control
and suppliers is disclosed in the strategic report on processes, with further details set out in the
page 51. audit committee’s report on pages 81-84.

Employment policies Going concern

Information on the Company’s employment policies The directors have made enquiries into the adequacy
is disclosed in the corporate governance report on of the Company’s financial resources, through a review
pages 83-84. of the Company’s budget and medium-term financial
plan, including capital expenditure plans and cash flow
Directors’ indemnities forecasts.
As permitted by the articles of association, the directors
have the benefit of an indemnity which is a qualifying The Company has modelled a base forecast in which,
third-party indemnity provision, as defined by section over the period to 28 January 2024 as it continues to
234 of the Companies Act 2006. The indemnity was in emerge from the pandemic, sales, profit and cash flow
force throughout the last financial year and is currently growth continues. The Company has anticipated within
in force. Throughout the financial year, the Company this forecast continued high levels of inflation,
also purchased and maintained, directors particularly on food products, wages and repairs.
and officers’ liability insurance, in respect of itself
and its directors. A more cautious scenario has been analysed, in which
sales decline by 5% in the next 12 months, compared
with FY19. The Company has reviewed, and is
satisfied with, the mitigating actions which it could take
if such a decline were to occur. Such actions could
include reducing discretionary expenditure and/or
implementing price increases.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 67

DIRECTORS’ REPORT

The directors are satisfied that the Company has Listing Rule 9.8.4 R
sufficient resources (eg profitability/liquidity) to Information required by this rule to be disclosed
withstand adjustments to the base forecast, as well as (starting on page indicated, if applicable):
the downside scenario.
 Details of long-term incentive schemes,
The Company has agreed with its lenders to replace page 70–71
normal financial covenant tests with a minimum liquidity  Provision of services by a controlling shareholder
covenant for the period up to and including January page 69–77,
2023, and relaxed leverage covenant tests for the  Agreements with controlling shareholders, page 42
second half of the financial year to 30 July 2023. The  Corporate governance (DTR 7.2.9 R),
Company is confident that it will be in a position to pages 78–84.
return to normal financial covenant tests thereafter. The
Company has re-financing options available including Future developments
possible extensions on the revolving credit facility. The Company intends to continue to operate pubs and
hotels throughout the UK and Ireland. The Company aims
As a result, the directors have satisfied themselves that to continue to provide customers with good-quality food
and drinks, served by well-trained and friendly staff, at
the Company will continue in operational existence for
reasonable prices.
the foreseeable future. For this reason, the Company
continues to adopt the going-concern basis in
Events after the reporting period
preparing its financial statements. There are no events to disclose.

Financial instruments
By order of the board
The Company’s policy on the use of financial
instruments is set out in note 22.

Greenhouse gas (GHG) emissions

Nigel Connor
GHG emissions Unit Quantity Company Secretary
2022 2021 6 October 2022
Scope 1 Tonnes CO2e 41,324 24,726
Scope 2 Tonnes CO2e 65,971 57,079
Fuel (car) Tonnes CO2e 454 33
Tonnes CO2e /
Intensity 61.9 105.9
£m revenue

Consumption (kWh)
2022 2021
Scope 1 226,818,295 134,994,694
Scope 2 205,305,472 178,260,013
Fuel (car) 1,917,037 139,138
Total 434,040,804 313,393,845

 The data in the above tables is calculated by taking

consumption data and converting it using conversion
factors published by the Department for Business,
Energy & Industrial Strategy.
 All emissions have been produced within the UK.
 This data doesn’t include amounts from the Republic
of Ireland, owing to us not holding this information.
 Reported data is for the year ended 31 July 2022
 Scope 1 – combustion of gas
 Scope 2 – purchase of electricity
 Refrigerant emissions from our pubs are
not reported, as they are immaterial
 The amounts for 2022 are for the 53 week period
ending 31 July 2022, while the amounts for 2021 are
for the 52 week period ending 25 July 2021.

Overseas branches
The Company has an overseas branch
in the Republic of Ireland.

68 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

DIRECTORS’ REMUNERATION REPORT
Annual statement
Dear shareholder The Remuneration Committee agreed that no
reductions would be made to pension contribution
The following salary increases and awards were made levels for existing directors and employees. This is on
to executive board members this year, in accordance the basis that the current pension contribution
with the remuneration policy agreed by shareholders at percentage is part of existing directors’ and employees’
the Company’s AGM in December 2020: contractual arrangements and complies with the
Company remuneration policy agreed by shareholders
Salary at the December 2020 AGM.
The salaries of the CEO, the Finance Director and the
Personnel and Legal Director were unchanged. This Accordingly, the Company paid 12% pension
compares with a 7.89% increase for the general contributions or a cash equivalent to executive
salaried workforce. directors this year.

The Personnel and Legal Director is retiring on 7 The CEO and the Personnel and Legal Director
October 2022. The Company has promoted the Retail received an additional 4% of their salary, because of
Audit Director to Personnel and Retail Audit Director. their length of service. This additional 4% is available to
His salary was increased by 20% on promotion. all employees with over 30 years’ service with the
Company.
Annual cash bonus
There will be no annual cash bonus awarded to Workforce engagement
executive directors this year. Wider workforce policies and issues, including (but not
exclusively) remuneration, are a standing item on
Deferred bonus scheme board agendas.
The deferred bonus scheme is a scheme which may
award shares to all senior managers throughout the In the current year two employee directors and two
business including executive directors. associate employee directors were appointed. This was
in order that debate and decision making at board level
Given the extraordinary circumstances of the past year, shared the benefit of the “front line” experience that the
the scheme was not due to deliver any award of company ‘s other regular meetings benefit from. This
shares. sharing of experience is vital to preserving the culture
of the company in the future
In recognition of the enormous effort and hard work
since March 2020, and in order to continue to motivate In setting remuneration for the executive board, the
all senior managers throughout the business in their committee takes into account wider workforce
continued focus to rebuild the business, the remuneration policies throughout the Company. Many
Remuneration Committee agreed to award a of the elements of executive board remuneration
discretionary bonus based on 10% increase in owners’ outlined above extend throughout much of the
earnings. At executive board level this will result in an Company, at varying levels
award of 25% of basic salaries in shares.
Debra van Gene
Company share incentive plan (SIP) Chair of the Remuneration Committee
The Company SIP is open to all employees in the 6 October 2022
Company, at varying levels, according to each
individual’s seniority and length of service.

Executive Directors received an amount equivalent to

25% of their salary in shares. The CEO and Personnel
and Legal Director received an additional award
equivalent to 10% of their salary, because of their
length of service. This additional 10% is available to all
employees with over 30 years’ service with the
Company.

Pension
A new all employee pension scheme has been
introduced, in line with current guidance and applies to
all new employees from 1 August 2022.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 69

DIRECTORS’ REMUNERATION REPORT

Remuneration policy
The committee reviews the executive directors’ remuneration packages at least annually.
The aim of the remuneration policy is to:
 Provide attractive and fair remuneration for directors
 Align directors’ long-term interests with those of shareholders, employees and the wider community
 Incentivise directors to perform to a high level

In agreeing on remuneration, account is taken of the pay levels at Wetherspoon, as well as those in the
hospitality industry in general, along with other comparisons and reports. The committee aims to take a fair and
commonsense approach.

This statement of our remuneration policy was approved by shareholders at the Company’s AGM on 17 December 2020.
The policy is put forward to shareholders’ for approval every three years.

Component Reason Operation, maximum achievable and performance criteria

Base salary Provide attractive Salaries are reviewed at least annually, with any changes
and fair normally taking effect from 1 October each year.
remuneration
for directors. Salary increases are awarded at the discretion of the
remuneration committee.

When considering salary levels and whether an increase should be offered, the
committee takes account of a variety of factors, including Company performance,
individual performance, experience and responsibilities, market information and the level
of increase being offered to other employees.

Benefits Provide attractive A range of taxable benefits is available to executive directors.

and fair These benefits comprise principally the provision of a car allowance,
remuneration life assurance, private medical insurance and fuel expenses.
for directors.
In addition, an allowance equivalent to 5% of salary is paid for a set number of calls to
monitor service and standards in pubs, predominantly in the evening and at weekends.
This is paid quarterly.

The cost of benefits provided changes in accordance with market conditions.

The committee monitors the overall cost of the package periodically.

Pension Provide attractive The Company does not operate any defined benefit pension schemes.
and fair
remuneration Newly appointed executive directors will receive a pension contribution of 6% which is
for directors. aligned with that made on average to the wider workforce at the date of this policy. For
the basis of this, please see the table on page 74.

Existing executive directors will continue to receive 12% of base salary,

on the basis that this has never been excessive, is lower than the average for FTSE250
firms and is not disproportionate with that of the wider workforce.

After 25 years’ service, all employees in the Company, including executive directors
receive additional pension payments of 2% of their salary. This rises by a further 2%
after each additional five years’ service.

Executive directors may receive a salary supplement in lieu of pension, at the discretion
of the remuneration committee.

Annual bonus Incentivise Annual bonus payments are paid in cash, at the discretion of the remuneration
plan directors committee.
to perform to a
high level. The bonus is based on profit growth, multiplied by a factor of 1.5 and paid to a maximum
of 45% of salary. Profit growth is calculated on profit before tax, property gains/losses
and exceptional items.

70 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 DIRECTORS’ REMUNERATION REPORT
Component Reason Operation, maximum achievable and performance criteria
Share Align directors’ The SIP allocates shares equivalent to 5% of salary to all Company employees after an
incentive interests with 18-month qualifying period. Shares do not vest for at least three years under this plan –
plan (SIP) those of and tax-free returns are possible, if the shares are held for five years or more.
shareholders,
employees and The Company offers extra shares under this scheme to some employees:
the wider pub managers receive an extra 5% annual award; head-office staff 10–15%; directors,
community. including executive board directors, 20%.

After 25 years’ service, executive directors receive additional SIPs of 5% of their salary.
This rises by a further 5% after each additional five years’ service. The increases which
apply to directors after 25 years and after each additional five years also apply to all
other employees.

Awards under this scheme are not based on financial or other targets.
The Company believes that excessive use of financial targets can lead to distortions in
companies’ behaviour and that it is important for there to be some share awards which
can be accumulated gradually, the value of which depends on the overall success of
the Company. The aim is for all employees to be able to accumulate shares over time,
to encourage loyalty and joint purpose.

Awards are made twice yearly throughout the Company.

Directors must be in office when the shares vest.

If changes are made to SIPs which apply to all employees in the schemes, they may be
applied to executive directors, at the discretion of the remuneration committee.

Deferred Align directors’ The Company does not operate a shareholding scheme with a minimum vesting period
bonus interests with of five years.
scheme those of
shareholders, The deferred bonus scheme may award shares to all senior managers, including
employees and executive directors. Bonus awards are made under the scheme, annually, at the
the wider discretion of the remuneration committee.
community.
Bonus awards are satisfied in shares. One-third of a participant’s shares will vest to the
participant on calculation of the amount of the award, one-third
will vest after one year and the remaining third will vest to the participant after two years
(in each case subject to the participant being employed at the release date).

The current performance criteria are based on earnings per share and owners’
earnings per share. The performance criteria for executive directors are the same as
those for senior managers who are eligible for the scheme. Awards are made using a
multiple based on an employee’s grade. The maximum bonus to be earned under the
scheme is 100% of annual salary.

Any changes made to the deferred bonus scheme for eligible senior managers may, at
the discretion of the remuneration committee, be applied to executive directors.

Non- Provide The fees paid to non-executive directors are determined by the executive board, taking
executive attractive and into account the level of fees for similar positions in the market and the time
directors’ fair commitment which each non-executive director makes.
fees remuneration
for directors. The non-executive directors receive no other remuneration or benefits
from the Company.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 71

DIRECTORS’ REMUNERATION REPORT

Shareholdings In the event of serious misstatement or misconduct,

Executive directors are required to maintain a minimum the remuneration committee can stop bonuses from
shareholding. Minimum holding requirements are set being paid and prevent share awards from vesting.
by the remuneration committee for each director and The remuneration committee will make reasonable
reviewed every three years, when the remuneration judgement, based on the facts at hand. Any
policy is reviewed. Minimum holding requirements actions taken will be at the discretion of the
include awarded shares which have not yet vested. remuneration committee.

To the extent that any executive director holds under Approach to recruitment remuneration
the required number of shares, he or she has a five- The aim, when agreeing on components of
year period to meet this requirement from the date on a remuneration package, including any variable pay
which the requirement was set (17 December 2020). for incoming directors, would be in accordance with
During this period, at least 50% of any vested share the table above.
awards must be retained, until the required
shareholding is attained. Account is taken of the individual’s experience, the
nature of the role being offered and his or her existing
On ceasing to be an executive director, a minimum remuneration package. Relocation expenses or
holding of 50% of the previous requirement must be allowances may be paid, as appropriate.
maintained for a minimum period of 12 months.
The committee may, at its discretion, offer cash, share-
This guideline applies to shares which vest following based elements or additional pension contributions, as
the adoption of this guideline. Any shares purchased by necessary, to secure an appointment, although it does
executives would not be subject to the guideline. not normally do so. Shareholders will be informed of
any such payments at the time of appointment.
The application of the minimum shareholding
requirement is at the discretion of the remuneration Our main principle is that payments made to
committee. prospective directors as compensation for loss of
benefits at a previous Company are inherently unfair,
The current minimum shareholding requirements are since it would be extremely rare for anyone below
200% of base salary, calculated on a £15.71 share board level to receive this sort of compensation.
price at 29 July 2019, this was the share price at the
start of the previous financial year: Chairman and directors’ service contracts
Number of shares The executive directors are employed on rolling
contracts, requiring the Company to give up to one
Minimum Shares held
Requirement as 31 July 2022 year’s notice of termination, while the director may give
six months’ notice.
B Whitley 28,000 25,957

J Hutson 76,000 196,618 In the event of termination of employment with the

S Cacioppo 44,000 58,158 Company, without the requisite period of notice,
T Martin 41,000 28,174,709 executive directors’ service contracts provide for the
payment of a sum equivalent to the net value of salary
Difference between the policy for and benefits to which the executive would have been
directors and that for employees entitled during the notice period.
Members of the wider management team may
receive each of the components of remuneration The executive is required to mitigate his or her loss and
awarded to the executive directors, although the such mitigation may be taken into account in any
amounts due for each component may vary, payment made. The Company’s policies on the
depending on their level of seniority. duration of directors’ service contracts, notice periods
and termination payments are all in accordance with
Non-executive directors are not entitled to any best industry practice.
component, other than fees.
The commencement dates for executive directors’
The wider employee population of the Company service contracts were as follows:
will receive remuneration which is considered
appropriate to their level of responsibility Tim Martin – 20 October 1992
and performance. John Hutson – 2 February 1998
Su Cacioppo – 10 March 2008
Withholding and recovery of awards Ben Whitley – 5 November 2015
Awards made under the bonus scheme and James Ullman – 22 September 2022
the deferred bonus scheme may be reclaimed,
in exceptional circumstances of misstatement All executive directors apart from Su Cacioppo, will be
or misconduct. standing for re-election at the AGM. Their current
service contracts do not have an explicit expiry date.

72 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 DIRECTORS’ REMUNERATION REPORT
Non-executive directors The annual variable values include the cash bonus
The non-executive directors hold their positions, which may be achievable. In the case of ‘expected’, an
pursuant to letters of appointment dated 12 November average percentage achieved over the last five years
2021, with a term of 12 months. has been used as a basis.

If their appointment is terminated early, non-executive The long-term incentive plan values include:
directors are entitled to the fees to which they would  The fixed 25% awarded under the Company’s
have been entitled up to the end of their term. They do share incentive plan
not participate in the Company’s bonus or share  An average achieved in respect of the
schemes. Their fees are determined by the executive deferred bonus scheme over the last five years
directors, following consultation with professional
advisers, as appropriate. Payments for loss of office
The Company’s policy is that the period of notice for
Employee directors executive directors will not exceed 12 months;
The employee directors hold their positions, pursuant accordingly, the employment contracts of the executive
to letters of appointment dated 9 December 2021, with directors are terminable on 12 months’ notice by the
a term of three years. Company or six months’ notice by a director.
In the event of gross misconduct, the Company may
External appointments terminate a director’s employment without notice or
Executive directors are not allowed to take external compensation.
appointments without the prior consent of the
Company. The Company has not released any In the event of a director’s departure, the Company’s
executive directors to serve as non-executive director policy on termination payments is as follows:
elsewhere.  The Company will seek to ensure that no more
is paid than is warranted in each individual case
Illustration of the application of the  Salary payments will be limited to notice periods
remuneration policy  There is no entitlement to bonus paid
The charts below set out the composition of the (or associated deferred shares or SIPs) following
chairman and executive directors’ remuneration notice of termination
packages in £000, at a minimum, a reasonable  The committee’s normal policy is that, where the
expectation target and as a possible maximum: individual is considered a ‘good leaver’, a prorated
bonus may be paid
Tim Martin
 The Company may enable the provision of
Maximum 100% £338 outplacement services to a departing director
Expected 100% £338
Retirement policy
Minimum 100% £338
The Company does not have a mandatory retirement
£0 £100 £200 £300 age. Employees wishing to retire should be aged at
least 55 years at the date of leaving (the minimum age
John Hutson a person can access a workplace pension) and serve
Maximum 42% 15% 43% £1,912 their contractual notice period. Retiring employees are
Expected 64% 4% 32% £1,259 permitted to retain any unvested shares held in any
Minimum 77% 19% £986 Company scheme.
£0 £400 £800 £1,200 £1,600 £2,000
Consideration of employment conditions
elsewhere in the Company
Ben Whitley
The committee receives information on salary
Maximum 40% 15% 45% £734 increases, bonus payments and other benefits
Expected 63% 5% 32% £479 available at the Company. These are taken into
Minimum 76% 21% £371 consideration when conducting the review of executive
£0 £200 £400 £600 £800 remuneration, although no formal consultation with
employees is undertaken in this regard.
Su Cacioppo
Maximum 40% 17% 43% £1,081 Consideration of shareholders’ views
Expected 63% 5% 32% £714 Any views in respect of directors’ remuneration
Minimum 78% 19% £561 expressed to the Company by shareholders have been,
and will be, taken into account in the formulation of the
£0 £300 £600 £900 £1,200
Fixed Annual variable Long-term incentive directors’ remuneration policy.

The fixed annual values include: Details of votes cast for and against the resolution to
 Fixed annual salary, benefits and allowances, in line approve last year’s remuneration report and any
with those outlined in the policy section, and based on matters discussed with shareholders during the year
the salaries applicable as at 31 July 2022 are provided in the annual report on remuneration.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 73

 DIRECTORS’ REMUNERATION REPORT

Annual report on remuneration

The table below sets out in a single figure the total amount of remuneration, including each element, received by each
director for the year ended 31 July 2022.

Single-figure table – audited

Full basic salary Voluntary COVID- Taxable Performance Long-term Pension

19 reductions Total Total fixed Total variable
(pre deductions) benefits/allowance1 bonus2 incentives4 contributions3
2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021
£000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000

Executive
directors
John Hutson 638 638 – (51) 54 33 – – 223 96 102 97 1,017 813 794 717 223 96
Su Cacioppo 358 358 – (6) 38 24 – – 125 54 57 51 578 481 453 427 125 54
Ben Whitley 250 250 – (4) 29 20 – – 62 31 30 30 371 327 309 296 62 31
James Ullman 45 – – – 9 – – – – – 6 – 60 – 60 – – –

1,291 1,246 – (61) 130 77 – – 410 181 195 178 2,026 1,621 1,616 1,440 410 181

Chairman, non-
executive
directors and
employee
directors
Tim Martin 324 324 – (51) 13 14 – – – – – – 337 287 337 287 – –
Ben Thorne 54 32 – (7) – – – – – – – – 54 25 54 25 – –
Debra van Gene 54 54 – (9) – – – – – – – – 54 45 54 45 – –
Richard Beckett 54 54 – (9) – – – – – – – – 54 45 54 45 – –
Harry Morley 54 54 – (9) – – – – – – – – 54 45 54 45 – –
Hudson Simmons 5 – – – – – – – – – – – 5 – 5 – – –
Deborah
5 – – – – – – – – – – – 5 – 5 – – –
Whittingham

550 518 – (85) 13 14 – – – – – – 563 447 553 447 – –

Total 1,841 1,764 – (146) 143 91 – – 410 181 195 178 2,589 2,068 2,179 1,887 410 181

1) Taxable benefits include car allowances and the provision of rail travel for Tim Martin, as well as
private health and fuel expenses for executive directors. In respect of the element for pub calls made to monitor
standards, 5% was awarded, in line with policy.
2) No bonus was awarded under the profit growth element of the bonus scheme, in line with policy. This bonus is only
awarded to the executive directors and not the employee directors, Hudson Simmons and Deborah Whittingham.
3) Existing executive directors receive either pension contributions, equivalent to 12% of salary, to the stakeholder
pension plan or salary in lieu of pension contributions. Additional pension payments are made, equivalent to 2% of
salary for 25–29 years’ service, a further 2% for 30–34 years’ service and a further 2% at 35+ years’ service. Su
Cacioppo, John Hutson and Ben Whitley took, in salary, the portion of their Company pension contribution which was
above the annual cap. For newly appointed executive directors they receive pension contributions at 6% which aligns
with contributions of the wider workforce.
4) The amount in the table under long-term incentives, includes the monetary value of the share awards which have
taken place during the period for both SIP and RSP payments which took place during October 2021 and March 2022.
The above table is on a cash basis and does not include the monetary value for the share awards that will take place in
October 2022. These have been accrued within note 5.
5) Ben Thorne was appointed a non-executive director on 17 December 2020. In FY21, Ben Thorne’s remuneration is
shown from the date of his appointment.
6) Deborah Whittingham and Hudson Simmons were appointed as employee directors on 20 December 2021. In
addition to the employee director’s fees above, both received earnings from the Company as an employee.
7) James Ullman was appointed personnel and retail audit director on 4 May 2022. James Ullman’s remuneration is
shown from the date of his appointment. He has not been included in the long-term Incentive award table on page 75
owing to these awards taking place prior to 4 May 2022.

The final amount received by executive directors for long-term incentive awards will be affected by future changes in the
Company’s share price. A 50% increase in the share price between the award date and the vesting date would increase
the value of the award by 50%. Conversely, a 50% reduction would reduce the value of the award by 50%.

74 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 DIRECTORS’ REMUNERATION REPORT
As at the date of the remuneration policy, the average employer contribution across all levels (pubs and head office) for
the stakeholder plan was 5.4%, with the average employer contribution across all levels (head office only) for the
stakeholder plan being 6.2%.

Details of targets applicable during the year are disclosed in the directors’ remuneration policy statement.
The resultant percentages against each of the bonus measures achieved are shown below, with the percentage
awarded for each director being the same.

Maximum Awarded B Whitley J Hutson S Cacioppo J Ullman

Profit growth 45.0% 0.0% - - - -

Total performance bonus 45.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Employee share scheme 25.0% 25.0% 62,452 186,108 104,478 -

Employee share scheme – long service* 10.0% 10.0% – 63,808 35,820 -
Deferred Bonus scheme 100.0% 25.0% 62,500 159,591 89,595 11,250
Total long term incentives 130.0% 55.0% 124,952 382,921 214,968 11,250
Total 175.0% 55.0% 124,952 382,921 214,968 11,250

*J Hutson and S Cacioppo receive an additional 10%, as they have completed 30 years’ service with the Company.
James Ullman was appointed personnel and retail audit director on 4 May 2022. James Ullman’s bonus measures are
shown from the date of his appointment.

Long-term incentive awards – audited

Number of shares Face value in £

*Share **Deferred Share Deferred
incentive bonus incentive bonus
plan scheme Total plan scheme Total
B Whitley 6,807 15,447 22,254 62,452 62,500 124,952
J Hutson 24,342 39,444 63,786 223,330 159,591 382,921
S Cacioppo 13,665 21,144 34,809 125,373 89,595 214.968
44,814 76,035 120,849 411,155 311,686 722,841

*Awarded at an average share price of £10.90, three days before grant; shares will vest three years after grant.
**Calculated at an estimated share price of £4.05, which is the share price five days before grant date. The actual award
will be determined by using the share price five days after the grant date.The grant date will be 7 October 2022. These
shares vest in three equal tranches in each of 2022, 2023 and 2024.

All awards have no further performance conditions attached, except to be employed by the Company at the vesting date.

Directors and connected persons’ interests in shares: audited

The interests of the directors in the shares of the Company, as at 31 July 2022, were as follows:

Ordinary shares of 2p each, held beneficially

Share Deferred Share Deferred
Shares incentive bonus 2022 Shares incentive bonus 2021
plan scheme plan scheme

T R Martin 28,174,709 – – 28,174,709 28,174,709 – – 28,174,709

B Whitley 14,064 11,893 – 25,957 12,287 8,987 723 21,997
J Hutson 156,219 40,399 – 196,618 152,035 30,013 2,036 184,084
S Cacioppo 35,479 22,679 – 58,158 38,616 16,848 1,143 56,607
J Ullman 22,629 7,804 – 30,433 – – – –
H Simmons 1,003 1,619 – 2,622 – – – –
D Whittingham 2,969 3,023 – 5,992 – – – –
B Thorne – – – – – – – –
D van Gene 3,777 – – 3,777 3,777 – – 3,777
R Beckett 2,000 – – 2,000 2,000 – – 2,000
H Morley 3,111 – – 3,111 3,111 – – 3,111

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 75

DIRECTORS’ REMUNERATION REPORT

With the exception of partnership shares, there have been no changes to these interests since 31 July 2022.

Partnership shares
Su Cacioppo and Ben Whitley are participants of the partnership share scheme and acquired 218 shares each in the
year. John Hutson is a participant in the partnership share scheme and acquired 217 shares in the year. Deborah
Whittingham was also a participant of the partnership share scheme and acquired 141 shares in the year. The market
price of the shares purchased ranged 567.0–1,155.0p.

Partnership shares are shares which can be purchased by individuals who work in the Company for a duration of time.
Participants can elect to purchase these shares which come out each employee’s payroll.

Performance graph – non-audited information

This graph shows the total shareholder return (with dividends reinvested) of a holding of the Company’s shares against a
hypothetical holding of shares in the FTSE All-Share Travel & Leisure sector index. The directors selected this index, as
it contains most of the Company’s competitors and is considered to be the most appropriate index for the Company.

Growth in the value of a hypothetical £100 holding since July 2008, based on 30-trading-day average values

700.0
Value of hypothetical £100 holding (£)

620.0

540.0

460.0

380.0

300.0

220.0

140.0

60.0
Jul-08 Jul-09 Jul-10 Jul-11 Jul-12 Jul-13 Jul-14 Jul-15 Jul-16 Jul-17 Jul-18 Jul-19 Jul-20 Jul-21 Jul-22

JD Wetherspoon

FTSE All-Share Travel &

Leisure

76 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 DIRECTORS’ REMUNERATION REPORT

Chief executive officer’s remuneration It is believed that using a consistent methodology with
that of gender pay reporting will produce the most
Long-term understandable ratios.
Performance
incentives
bonus
scheme
Single figure payment There has been no comparison between dividends and
shares
of total achieved
vesting
remuneration against
against
share buy-backs this year, as there has been no such
maximum
possible
maximum events in the current and previous financial year.
possible*

John Hutson £000 % % Remuneration committee

2022 1,017 - 100 The remuneration committee comprises the following
2021 813 - 100 independent directors: Debra van Gene (chair),
2020 738 - 100 Sir Richard Beckett, Ben Thorne and Harry Morley.
2019 1,035 10 100
2018 1,490 29 100 The committee meets regularly and considers
2017 1,698 85 100 executive directors’ remuneration annually.
2016 1,187 21 100 It approves all contractual and compensation
2015 1,202 10 100
arrangements for the executive directors, including
performance-related payments.
2014 741 19 100
2013 1,079 43 100
Shareholders’ vote on 2021 directors’
* As long-term incentive scheme shares issued have remuneration report
no further performance criteria attached, all shares The table below shows the voting outcomes
previously awarded vest in full when the vesting date at the 18 November 2021 AGM for the directors’
is reached. remuneration report.
Number of % of
votes votes
The following table compares the change in For 93,104,202 92.36%
remuneration of all the directors, non-executive Against 7,666,690 7.61%
directors and chairman with that of all employees Abstentions 37,197 0.03%
Total cast 100,808,089 100.00%
Change in Change in
Change in taxable
annual annual
benefits
salary bonus All votes at the AGM were passed with at least
% % %
80% of the cast votes.
Ben Whitley - 45.0 -
John Hutson - 63.6 - Shareholders’ vote on 2020 directors’
Su Cacioppo - 58.3 - remuneration policy
Tim Martin - (7.1) - The table below shows the voting outcomes
Debra Van Gene - - -
at the 17 December 2020 AGM for the directors’
remuneration policy.
Richard Beckett - - - Number of % of
Harry Morley - - - votes votes
Ben Thorne - - - For 86,184,868 84.88%
Total Employees 3.7 13.4 64.2 Against 14,880,202 14.65%
Abstentions 477,476 0.47%
Change in total employees’ salary is calculated
Total cast 101,542,546 100.00%
based on the amounts paid to all employees adjusted
for redundancy and employer’s national insurance
payments, divided by the number of hours Resolutions at last year’s AGM seeking the re-election
worked by employees. of Sir Richard Beckett and Debra Van Gene received
less than 80% of the total votes cast.
Chief executive’s pay ratios
The table below shows the chief executive’s total The Company has stated, on numerous occasions, its
remuneration, as disclosed in the single-figure table, view that the Company benefits from the experience of
compared with that of full-time equivalent employees’ directors who have served more than nine years and
median (50th), 25th and 75th percentiles in the UK. does not agree that it impacts the individual’s
Pay ratios table independence.

The company has continued to engage with

Year Method 25th 50th 75th
shareholders regarding its views on board composition
2022 Option B 47:1 45:1 41:1
2021 Option B 41:1 40:1 38:1 and intends doing so going forwards.

The Company has used the same data used for gender By order of the board
pay reporting to determine the median, 25th and 75th
percentile employees. This method is called option B in Nigel Connor
The Companies (Miscellaneous Reporting) Regulation Company Secretary
2018. 6 October 2022

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 77

CORPORATE GOVERNANCE
Introduction
This section of the report sets out how the Company They contribute significantly as directors through their
has applied the relevant principles and provisions of individual skills, considerable knowledge and
the 2018 code and identifies and explains where it has experience of the Company. They also continue to
not. demonstrate strong independence in the manner in
which they discharge their responsibilities as directors.
1. Board Leadership and Company Purpose Consequently, the board has concluded that, despite
their length of tenure, there is no association with
The Company’s approach is set out on page 79 management which could compromise their
independence.
2. Division of Responsibilities
19 – Chairman’s term
Details of our governance and management structure
are set out on page 80 Tim Martin has served more than nine years as
chairman of the board. The board considers that his
3. Composition, Succession and Evaluation considerable knowledge and experience from founding
the Company and leading it for over 40 years have had
The board’s approach to these areas via the work of a positive effect on the Company’s performance.
the nomination committee and the Company’s The board believes that it is in the interest of the
employment policies are set out on page 83 Company and its shareholders for Tim Martin to remain
as chairman.
4. Audit, Risk and Internal Control
21 – External board evaluation
An outline of our internal processes in this
area set out on pages 81-84 A requirement of corporate governance is a
recommendation for a third party to evaluate the
5. Remuneration
functioning of the board. Delegation of a key task of the
chairman and of the directors of the board itself to a
A report on how the Company has applied the current
third party, often with little or no connection with the
remuneration policy and payments made to directors
Company’s business and with a very limited knowledge
during the period is on pages 69-77.
of the directors, may be a dangerous step for a board
Statement of compliance to take. It is the function of the board itself to evaluate
The Company is committed to high standards of its own performance – and that performance is most
corporate governance. The board believes that evident from the results of the underlying business.
the Company has been compliant with the code For this reason, it is believed best for the Company to
throughout the 53 weeks ended 31 July 2022, continue with its current system of ‘self-evaluation’.
except as described below.
30 – Long-term shareholdings
3 – Dialogue with shareholders
To promote long-term shareholdings by executive
The code indicates that the chairman should discuss directors and align their interests with shareholders,
governance and strategy with major shareholders. The the code requires that any share awards given to
chairman has had many discussions with shareholders executive directors should have a minimum vesting
since the Company’s flotation in 1992, although period of five years. The executive directors receive
corporate governance has rarely been raised. The shares under schemes which are open to other
majority of discussions with major shareholders now employees and have vesting periods of less than five
takes place among the CEO, finance director and years. The Company has disclosed details of the share
shareholders. These discussions are relayed to, and award schemes in the remuneration policy on pages
considered by, the board. The chairman and senior 70–71. To promote long-term shareholding by
independent director met a number of major executive directors, the Company requires directors to
shareholders to discuss the appointment of employee hold a minimum number of shares as disclosed on
directors to the board. The chairman is available for page 72. Restrictions are in place on the sale of
discussion with major shareholders, when requested. shares, if directors have not achieved the minimum
holding.
10 – Non-executive directors’ independence
38 – Alignment of pension contribution rate of
Debra van Gene and Sir Richard Beckett have served executive directors with wider workforce
more than nine years on the board and so may not be
considered independent under the code. The board The code states that pension contribution rates for
considers that their performance as non-executive executive directors and payments in lieu, should be
directors continues to be effective. aligned with those available to the workforce. As set
out in the 2020 remuneration policy, the company took
the decision that existing executive directors would
continue to receive 12% of base salary on the basis

78 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 CORPORATE GOVERNANCE
that it had never been excessive, is lower than average an important forum for shareholders to raise
for a FTSE 250 company and is not disproportionate to questions with the board
the wider workforce. In August 2022, the company  Regular feedback from the Company’s stockbrokers
changed its employee pension policy to reward long  Interim, full and ongoing announcements circulated
service rather than being based on rank/job title. As a to shareholders
consequence the existing pension contributions paid to  Any significant changes in shareholder movement
executive directors are now more closely aligned with being notified to the board by the company secretary,
thepolicy applicable to the wider workforce. when necessary
 The company secretary maintaining procedures and
A full version of the code is available on the official
agreements for all announcements to the Stock Market
website of the Financial Reporting Council:
 A programme of regular meetings between investors
frc.org.uk
and directors of the Company

Board leadership and Company purpose Matters reserved for the board

The board of directors The following matters are reserved for the board:
The board comprises the following members:
 Tim Martin, chairman  Board and management
 Structure and senior
 John Hutson, chief executive officer
management responsibilities
 Ben Whitley, finance director  Nomination of directors
 Su Cacioppo, personnel and legal director  Appointment and removal of
 James Ullman, personnel and retail auditor director chairman and company secretary
 Debra van Gene, non-executive director
 Sir Richard Beckett, non-executive director  Strategic matters
 Harry Morley, non-executive director  Strategic, financing or adoption of
new business plans, in respect of any
 Ben Thorne, non-executive and senior independent
material aspect of the Company
director
 Deborah Whittingham, employee director  Business control
 Hudson Simmons, employee director  Agreement of code of ethics
and business practice
Will Fotheringham and Emma Gibson attend board  Internal audit
meetings in their capacity as associate employee  Authority limits for heads of department
directors.
 Operating budgets
The board considers each of Debra van Gene, Sir  Approval of a budget for investments
Richard Beckett, Ben Thorne and Harry Morley to be and capital projects
independent.  Changes in major supply contracts

 Finance
Biographies of all non-executive and executive
 Raising new capital and confirmation
directors are provided on page 65 and can be viewed of major facilities
on the Company’s website: jdwetherspoon.com  The entry into asset-financing transactions
 Specific risk-management policies, including
The chairman regularly meets the non-executive insurance, hedging and borrowing limits
directors and evaluates the performance of the board,  Final approval of annual and interim accounts
and accounting policies
its committees and its individual directors.
 Appointment of external auditors
The Company’s purpose and how it establishes  Legal matters
its values and culture through engagement with  Institution of legal proceedings,
employees are disclosed on page 51. where costs exceed certain values

Directors’ conflicts of interest  Secretarial

 Call of all shareholders’ meetings
The board expects the directors to declare any
 Delegation of board powers
conflicts of interest and does not believe that any  Disclosure of directors’ interests
material conflicts of interest exist.
 General
Relations with shareholders  Board framework of executive
The board takes measures to ensure that all board remuneration and costs
members are kept aware of both the views of major
shareholders and changes in the major shareholdings Culture and values
of the Company. Efforts made to accomplish effective The board monitors the culture and the values of the
communication include: Company in several ways:
 Annual general meeting, considered to be  The appointment of employee directors to the
board

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 79

CORPORATE GOVERNANCE

 Meeting and talking with employees from our  Reviewing whistleblowing reports and
pubs during pub visits, regional meetings and at outcomes via the audit committee
head office weekly meetings
 Attendance of area managers at the opening Division of responsibilities
section of the board meetings to discuss issues
relating to the operation of their pubs and the
It is not advantageous, in a company like Wetherspoon,
Company generally
 Reviewing the outcome of weekly discussion for there to be high barriers or exaggerated distinctions
meetings of selected pub and area managers between the role of chairman and that of chief
led by senior Company employees executive officer. However, some general distinctions
are outlined overleaf.

Chairman’s responsibility Chief executive officer’s responsibility

The chairman is responsible for the smooth running The chief executive officer is responsible for the
of the board and ensuring that all directors are smooth daily running of the business
fully informed of matters relevant to their roles

Delegated responsibility of authority from the Developing and maintaining effective management controls,
Company to exchange contracts for new pubs and to sign planning and performance measurements
all contracts with suppliers

Providing support, advice and feedback to the Maintaining and developing an effective
chief executive officer organisational structure

Supporting the Company’s strategy and encouraging the External and internal communications, in conjunction
chief executive officer with that strategy’s development. with the chairman, on any issues facing the Company

Chairing general meetings, board meetings, Implementing and monitoring compliance

operational meetings and agreeing on board agendas with board policies
and ensuring that adequate time is available for
discussion of agenda items

Management of the chief executive officer’s contract, Timely and accurate reporting of the above to the board
appraisal and remuneration, by way of making
recommendations to the remuneration committee

Providing support to executive directors and Recruiting and managing senior managers in the business
senior managers of the Company

Helping to provide the ‘ethos’ and ‘vision’ of the Company, Developing and maintaining effective risk-management
after discussions and debates with employees of all levels, and regulatory controls
customers, shareholders and including organisations
such as CAMRA

Helping to provide information on customers and Maintaining primary relationships with shareholders
employees’ views by calling on pubs and investors

Helping to make directors aware of shareholders’ concerns Chairing the management board responsible for
implementing the Company’s strategy

Helping to ensure that a culture of openness and debate

exists in the Company

Ensuring compliance with the London Stock Exchange

and legal and regulatory requirements, in consultation with
the board and the Company’s external advisers

The board has several established committees as set out below. The board met eight times during the
year ending 31 July 2022. Attendance of the directors,non-executives, employee and associate employee directors
where appropriate, is shown below.

80 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 CORPORATE GOVERNANCE

Board Audit Remuneration Nomination

Number of meetings held in the year 8 4 1 2
Tim Martin 8 N/A N/A N/A
John Hutson 5 N/A N/A N/A
Su Cacioppo 8 4 N/A N/A
Ben Whitley 8 4 N/A N/A
Debra van Gene 7 4 1 2
Sir Richard Beckett 7 4 1 2
Harry Morley 8 4 1 2
Nigel Connor 8 4 N/A N/A
Ben Thorne 8 4 1 1
James Ullman 2 4 N/A N/A
Debbie Whittingham 7 N/A N/A N/A
Will Fotheringham 7 N/A N/A N/A
Hudson Simmons 6 N/A N/A N/A
Emma Gibson 7 N/A N/A N/A

Audit, risk and internal control  Reviews and monitors procedures in relation to the
Company’s whistleblowing policy
Audit committee  Reviews and questions the effectiveness of
The committee’s primary role is to assist the board all risk-management and internal control systems
in the provision of effective governance over the  Reviews the retail audit director’s statement on
Company’s financial reporting, risk management and internal controls on completed audits
internal control; in particular, it performs the  Considers the overall impact on the business of the
following activities: matters arisen from the various reviews described
above and any other matters which the auditors,
 Assumes direct responsibility for the appointment,
internal or external, may bring to the attention
compensation, resignation and dismissal of the
of the committee
external auditors, including review of the external audit,
 Ensures that all matters, where appropriate, are
its cost and effectiveness
raised and brought to the attention of the board
 Reviews the independence of the external auditors,
including consideration of the level of non-audit work Significant financial reporting items
carried out by them The accounting policies of the Company and the
 Reviews the scope and nature of the work estimates and judgements made by management are
to be performed by the external auditors, assessed by the committee for their suitability. The
before audit commences following areas are those considered by the committee,
 Reviews the half-year and annual to be the most significant:
financial statements  The provision for the impairment of fixed assets –
 Ensures compliance with accounting standards and several judgements are used in making this calculation,
monitors the integrity of the financial statements and primarily on expected future sales and profits. The
formal announcements relating to the financial committee received reports and questioned
performance of the Company and supports the board in management on the calculations made and the
its responsibility to ensure that the annual financial assumptions used
statements are fair, balanced and understandable  Significant one-off items of expense or income
 Reviews the internal audit plan, which is updated to are reported as exceptional on the face of the income
reflect the changing needs of the business and the statement. All exceptional items are reviewed by
concerns of management and the audit committee the committee
 Reviews and raises questions on all internal audit  The ongoing application of IFRS 16 – Lease to the
reports and requests management to adjust the Company’s lease portfolio, including the accounting for
prioritisation of mitigating actions, as needed. Areas lease modifications and the application of the COVID-
reviewed this year included supply chain and 19 related rent concession practical expedient along
distribution centre, pub closures, system security, IT, with the presentation and disclosure of leases.
cyber-crime, changes in business environment, decline  The committee reviewed the financial plans,
in like-for-like sales volume and escalating costs of modelled scenarios and assumptions made by the
labour Company in support of the presentation of the financial
 Reviews, with the support of specialists as required, statements on a going concern basis
controls over access to the IT systems used around the  The committee reviewed and raised questions
business and agrees with management on the timing of on the calculations made by the Company in relation to
any mitigating actions to be carried out

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 81

CORPORATE GOVERNANCE

the hedge accounting and effectiveness for interest- The internal audit department, in conjunction with
rate swaps feedback from senior management of the business
functions, produces a risk register annually.
The committee is satisfied that the judgements made
by management are reasonable and that appropriate The identified risks are assessed, based on the
disclosures have been included in the accounts. likelihood of a risk occurring and the potential impact
to the business, should the risk materialise.
Non-audit services
During the year, the Company made no use of The retail audit director determines and reviews the
specialist teams from Grant Thornton UK LLP, relating risk-assessment process and will communicate the
to accounting or tax services. The fees paid to Grant timetable annually.
Thornton UK LLP for non-audit services were £55,000 The risk register is presented to the audit committee
(2021: £33,000), relating to interim review procedures. and management board annually, with a schedule of
The use of Grant Thornton UK LLP for non-audit work audit work agreed on, on a rolling basis. The purpose
is monitored regularly, to achieve the necessary of this work is to review, on behalf of the Company and
independence and objectivity of the auditors. Where the board, those key risks and the systems of control
the auditors provide non-audit services, their objectivity necessary to manage such risks.
and independence are safeguarded by the use of
different teams. See note 2 on page 15, for a Where recommendations are made for changes in
breakdown of the auditor’s remuneration for audit and systems or processes to reduce risk, internal audit will
non-audit services. follow up regularly to ensure that the recommendations
are implemented.
External auditors
No significant failings of internal control were identified
The audit committee is responsible for making
during these reviews.
recommendations to appoint, reappoint or remove
external auditors. Following a review by the audit A summary of the financial risks and treasury policies
committee, the board agreed to recommend the can be found on pages 52-53, together with other risks
reappointment of Grant Thornton UK LLP as external and uncertainties.
auditors at the AGM in November 2022.
Emerging risks
Audit-tendering and rotation The Company monitors emerging risks through the
The audit committee keeps under review the regulatory receipt of advice and feedback from head office and
requirements on audit-tendering and rotation. pub staff, customers, suppliers, and several external
The Company will be required to change its audit firm advisers and by maintaining an awareness of the wider
for the year ending 25 July 2038, at the latest. The economic, political and social environment.
audit was last tendered in 2018 – and Grant Thornton
Any potential risks identified will be discussed in the
UK LLP has been in place as the Company’s auditor
relevant internal meetings, where any potential impact
for five years.
on the business will be considered. Any significant
The disclosures provided within this report constitute risks identified will be added to the Company’s risk
the Company’s statement of compliance with the register.
requirement of the statutory audit services for large
Internal control
companies market investigation (Mandatory use of
During the year, the Company provided an internal
competitive tender processes and audit committee
audit and risk-management function. The creation of
responsibilities) order 2014.
a system of internal control and risk mitigation is a key
Effectiveness of external auditors part of the Company’s operations and culture. The
The audit committee assesses the ongoing board is responsible for maintaining a sound system
effectiveness of the external auditors and audit of internal control and reviewing its effectiveness.
process, on the basis of meetings and internal The function can only manage, rather than entirely
reviews with finance and other senior executives. eliminate, the risk of failure to achieve business
objectives. It can provide only reasonable, and not
In reviewing the independence of the external auditors,
absolute, assurance against material misstatement or
the audit committee considers several factors. These
loss. Ongoing reviews, assessments and management
include the standing, experience and tenure of the
of significant risks took place throughout the year
external auditors, the nature and level of services
under review and up to the date of the approval of the
provided and confirmation from the external auditors
annual report.
that they have complied with relevant UK
independence standards. The terms of reference The Company has an internal audit function
of the audit committee are available on the which is discharged as follows:
Company’s website.  Regular audits of the Company’s stock
 Unannounced visits to pub sites
Risk management
 Monitoring systems which control the Company’s
The board is responsible for the Company’s
cash
risk-management process.
 Health and safety visits, ensuring compliance
with Company procedures
 Reviewing and assessing the impact of

82 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 CORPORATE GOVERNANCE

legislative and regulatory change Companywide scheme. However, during the current
 Risk-management process, identifying key risks year no such award was given based on such targets.
facing the business
The Company has key controls, as follows: Awards made are predictable and within a range
 Authority limits and controls over cash-handling, of values. The remuneration committee can apply
purchasing commitments and capital expenditure discretion in the application of awards.
 A budgeting process, with a detailed 12-month
The terms of reference of the remuneration committee
operating plan and a mid-term financial plan,
are available on the Company’s website.
both approved by the board
 Business results reported weekly, with a report Nomination committee
compared with budget and the previous year The committee meets at least annually and:
 Forecasts prepared regularly throughout the year,  reviews the board structure, size, diversity (including
for review by the board gender), composition and successional needs, keeping
 Complex treasury instruments are not used. The under review the balance of membership between
Company, from time to time, as stated in this report executive and non-executive and the required blend
and accounts, enters into swap arrangements which fix of skills, experience, knowledge and independence
interest rates at certain levels for a number of years on the board.
and enters into supply arrangements with fixed prices  formally proposes any new executive or non-
for electricity and gas, for example, which run for executive directors for the approval of the whole
between one and three years board, following a reasonable process for such
 An annual review of the amount of external an appointment. This includes a review of skill set,
insurance which it obtains, bearing in mind the industry knowledge and experience to meet the
availability of such cover, its costs and the likelihood of strategic needs of the business.
the risks involved  reviews the leadership and successional needs of
 Regular evaluation of processes and controls, the organisation, with a view to ensuring the long-term
in relation to the Company’s financial success of the Company.
reporting requirements  ensures that all directors offer themselves for
annual re-election by shareholders.
The directors confirm that they have reviewed the
effectiveness of the system of internal control. No director is involved in any decision about his or her
own reappointment. In carrying out these activities,
Remuneration and nomination the non-executive directors follow the guidelines of the
Chartered Governance Institute and comply with the
Remuneration committee
code.
The committee is responsible for determining the
remuneration received by executive directors and The terms of reference of the nomination committee
senior managers. When setting levels of remuneration, are available on the Company’s website.
the committee seeks to ensure that they are sufficient
to attract and retain people with the necessary skills In December 2021, the Company appointed two
and experience. The committee seeks to ensure that employee directors to the full board of the Company
remuneration is not excessive and is in line with and two associate employee directors who attend
amounts paid by comparable companies. In setting board meetings. On 4 May 2022, the Company
executive directors’ remuneration, the committee takes announced the retirement of Su Cacioppo and the
into account wider workforce remuneration policies appointment of James Ullman to the board. Sir Richard
throughout the Company, with many elements Beckett will retire as a non-executive director after the
extending throughout much of the Company at varying Company’s AGM on 17 November 2022 at which he
levels according to seniority and length of service. will not seek re-election. No other board changes have
been made.
The remuneration policy operated as intended during
the year – no changes were made and normally no Employment policies
discretion is applied. However, during the current year, Staff are encouraged to make a commitment to the
discretion was applied in respect of the deferred bonus Company’s success and to progress to more senior
percentage which was awarded to all participants. roles as they develop.

The directors’ report on remuneration is set out on In selecting, training and promoting staff, the Company
pages 69–77. has to take account of the physically demanding nature
of much of its work. The Company is committed
Directors’ remuneration is clearly presented in the to equality of opportunity and to the elimination of
accounts. The remuneration policy is clearly stated, discrimination in employment.
with the calculation of performance measures
explained. The remuneration policy does not rely overly The Company aims to create and maintain a working
on target-based incentives, with share awards normally environment, terms and conditions of employment and
given based on profits, earnings per share and owners’ personnel and management practices which ensure
earnings growth, as well as some shares awarded that no individual receives less favourable treatment
without performance targets as part of a on the grounds of his or her race, religion or belief,
nationality, ethnic origin, age, disability, gender

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 83

CORPORATE GOVERNANCE

(including gender reassignment), sexual orientation, Race and ethnic diversity

part-time status or marital status.
Internal communications seek to ensure that staff are
Employees who become disabled will be retained, well informed about the Company’s progress, through
where possible, and retrained, where necessary. the use of regular digital newsletters, and staff liaison
meetings, at which employees’ views are discussed
The Company has established a range of policies,
and taken into account.
covering issues such as diversity, employees’ well-
being and equal opportunities, aimed at ensuring that All pub staff participate in bonus schemes related
all employees are treated fairly and consistently. to sales, profits, stocks and service standards.

The Company has also established the following Approved by order of the board
network groups to foster discussion and generate ideas
Nigel Connor
about these issues:
Company Secretary
LGBTQIA+
6 October 2022
Women

84 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

fdfdfds
INFORMATION FOR SHAREHOLDERS

Ordinary shareholdings at 31 July 2022

Number of % of total % of total shares
Shares of 2p each Number
shareholders shareholders held

Up to 2,500 3,626 88.1 1,557,514 1.2

2,501–10,000 235 5.7 1,137,221 0.9
10,001–250,000 195 4.8 11,538,554 9.0
250,001–500,000 23 0.5 8,301,695 6.4
500,001–1,000,000 12 0.3 8,309,785 6.5
Over 1,000,000 24 0.6 97,905,386 76.0
   
   
4,115 100.0 128,750,155 100.0

Source: Computershare Investor Services plc

Substantial shareholdings
The Company has been notified of the following substantial holdings in its share capital at 31 July 2022:

Number of % of share
ordinary shares capital

Tim Martin 28,174,709 21.9

Columbia Threadneedle Investments 13,824,766 10.7
FIL Investment International 7,071,516 5.5
MFS Investment Management 6,498,779 5.1
J D Wetherspoon plc Company Share Plan* 4,416,005 3.4
Artemis Investment Management 4,397,259 3.4
Hargreaves Lansdown Asset Management 3,797,892 3.0
Fidelity Investments 3,765,322 2.9

Source: Investec Bank plc. This schedule shows the consolidated shareholdings of individuals and companies,
whereas the first table shows shareholdings by individual holding.

*This represents shares which have been purchased by the Company for the benefit of employees under the SIP.
Please see pages 70–71. This includes vested shares held by employees.

Share prices
25 July 2021 1,124p
Low 516p
High 1,180p
31 July 2022 557p

Shareholders’ enquiries
If you have a query about your shareholding, please contact the Company’s registrars directly:
Computershare Investor Services plc: uk.computershare.com/investor
0370 707 1091

Annual report
Paper copies of this annual report are available from the company secretary, at the registered office.

E-mail: [email protected]

This annual report is available on the Company’s website: jdwetherspoon.com/investors-home

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 85

 PUBS OPENED DURING THE FINANCIAL YEAR
Name Address Town/City Postcode Country
Keavan’s Port 1-5 Camden Street Upper Dublin D02 TC61 Ireland

The South Strand 1 Hanover Quay Dublin D02 E295 Ireland

The Scarsdale Hundred 2 Sevenairs Road Sheffield S20 1NZ England

The Navigation Inn 1 Wharf Road Birmingham B30 3LS England

An Geata Arundel 9 Arundel Square Waterford X91 RD35 Ireland

The Raymond Mays 44–48 North Street Bourne PE10 9AB England

The Prense Well 5 The Mount Heswall CH60 4RE England

PUBS CLOSED DURING THE FINANCIAL YEAR

Name Address Town/City Postcode Country

St Georges Hall 203 Church Road Bristol BS5 9HL England

The Vulcan 181 Main Street Coatbridge ML5 3HH Scotland

The Running Horses (Lloyds) Water Street/ Chalon Way St Helens WA10 1PY England

The Pear Tree 25–27 Alcester Road South Birmingham B14 7JQ England

The Drum 557–559 Lea Bridge Road Leyton E10 7EQ England

The Three Tun Tavern 1–5 Temple Road, Carysford Avenue Dublin A94 Y5F1 Ireland

The Milan Bar 14–32 High Street Croydon CR0 1YA England

The Oyster Rooms Unit 3, Fulham Broadway Centre Fulham SW6 1AA England

The Looking Glass 41–43 Buttermarket Street Warrington WA1 2LY England

The London Bar South Terminal, Airside, Gatwick Airport Crawley RH6 0NN England

The Skylark 34–36 South End Croydon CR0 1DP England

The Robert Peel 5–10 Market Place Bury BL9 0LD England

The Christopher Creeke 2 Holdenhurst Road Bournemouth BH8 8AD England

The Bell Hotel 40 Market Square Aylesbury HP20 1TX England

The Windlesora 17 William Street Windsor SL4 1BB England

86 ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 J D WETHERSPOON PLC

 COMPANY INFORMATION

Registered office
Wetherspoon House

Central Park
Reeds Crescent
Watford
WD24 4QL

Company number
1709784

Registrars
Computershare Investor Services plc
PO Box 82
The Pavilions
Bridgwater Road
Bristol
BS99 6ZY

Independent auditors
Grant Thornton UK LLP
Chartered Accountants and
Statutory Auditors
30 Finsbury Square
London
EC2A 1AG

Solicitors
Macfarlanes LLP
20 Cursitor Street
London
EC4A 1LT

Bankers
Allied Irish Banks
Banco de Sabadell S.A London Branch
Barclays Bank plc
BNP Paribas
Clydesdale Bank plc
Co Operative Rabbobank U.A
Crédit Industriel et Commercial.
Handelsbanken Bank
HSBC Bank plc
Mediobanca S.p.A
MUFG Bank Ltd
National Westminster Bank plc
Santander UK plc
The Governor and Company of the Bank of Ireland

Financial advisers
Investec Bank plc
Rushe Advisors

Stockbrokers
Investec Bank plc

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 87

 GLOSSARY

 AGM = “annual general meeting”. Annual assembly of a company’s stakeholders.

 APM = “alternative performance measure” Financial measure of historical/future financial performance, other than a
financial measure defined or specified in the applicable financial reporting framework.
 CAMRA = “Campaign for Real Ale”. Organisation which promotes real ales, ciders and perries as well as traditional UK
pubs and clubs.
 CEO = “chief executive officer”. Individual responsible for making managerial decisions in the company to which he or she
is contracted to.
 CJRS = “Coronavirus job retention scheme”. Initiative introduced by the UK Government allowing employers to access
financial support to pay part of their employees’ wages.
 CLBILS = “Coronavirus large business interruption loan scheme”. Financial support created by the UK Government during
the COVID-19 pandemic.
 EBITDA = “earnings before interest, taxes, depreciation and amortisation”. An alternative performance measure (APM).
 ESG = “environmental, social and governance”. Set of standards measuring a business’s impact on society.
 FRC = “Financial Reporting Council”. Independent regulator in the UK and Ireland responsible for regulating auditors,
accountants and actuaries. It also sets the UK corporate governance and stewardship codes.
 FTSE = “Financial Times Stock Exchange”. Index tracking the largest companies trading on the London Stock Exchange
(by market capitalization).
 FY = “financial year”. For Wetherspoon, the year being reported is 26 July 2021 - 31 July 2022.
 GHG = “greenhouse gas”. A gas which absorbs and emits the radiant energy which causes the greenhouse effect.
(Trapping heat in the atmosphere, therefore warming up the planet).
 HMRC = ‘Her Majesty’s Revenue and Customs’. Non-ministerial UK Government department responsible for collecting
taxes and paying some forms of state support.
 IAS = ‘international accounting standard’. Older accounting standard issued by the International Accounting Standards
Board. IASs were replaced in 2001 by IFRSs.
 IASB = ‘International Accounting Standards Board’. Private-sector body developing and approving the international
financial reporting standards (IFRSs).
 IBOR = ‘inter-bank offered rate’. Basic rate of interest used in lending among banks on the financial market and as a
reference in setting interest rates on other loans.
 IBR = ‘incremental borrowing rate’. Rate of interest which a lessee would have to pay to borrow the funds necessary to
obtain an asset.
 IFRIC = ‘international financial reporting standards interpretations committee’. Body which reviews accounting issues, on a
timely basis, which have arisen within the context of current international reporting standards.
 IFRS = ‘international financial reporting standards’. Accounting standards issued by the International Accounting Standards
Board.
 ISA = ‘international standards on auditing’. Regulatory standards to be followed when auditing financial information, issued
by the International Auditing and Assurance Standards Board.
 KPI = ‘key performance indicators’. Measures which companies use to evaluate a company’s success in a particular
activity in which it engages.
 LGBTQIA+ = ‘lesbian, gay, bisexual, transgender, queer/questioning, intersex, asexual, pansexual and allies’. An inclusive
term for people of various genders and sexualities.
 LIBOR = ‘London inter-bank offered rate’. Basic rate of interest used in lending among banks on the financial market.
 LLP = ‘limited liability partnership’. Type of ownership in which some or all partners have limited liabilities.
 NIC = ‘national insurance contributions’. Type of income tax paid by both employees and employers.
 PAYE = ‘pay-as-you-earn tax’. Type of income tax paid by an employer on behalf of an employee, after being deducted
from the employee’s salary.
 RNS = ‘Regulatory News Service’. Service which transmits regulatory and non-regulatory information published by
companies and organisations (eg Share Award) to the local market.
 SAP = Accounting software used by Wetherspoon.
 SIPs = ‘share incentive plan’. An approved, tax-efficient plan which employers can provide to employees to award their
workforce in shares.
 SONIA = ‘sterling overnight interbank average rate’. Interest rate paid by banks on unsecured transactions in the UK
market – an alternative measure to LIBOR.
 UK GAAP = ‘UK generally accepted accounting practice’. Body of accounting standards published by the UK’s Financial
Reporting Council.
 VAT = ‘value-added tax’. Form of tax paid to HMRC on a product/service at each stage of production, distribution and sale
to the end customer.
 WACC = ‘weighted average cost of capital’. Rate which a company is expected to pay, on average, to all of its security
holders to finance its assets.

J D WETHERSPOON PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2022 88

fdfdfds

J D Wetherspoon plc
Wetherspoon House, Central Park
Reeds Crescent, Watford, WD24 4QL

01923 477777
jdwetherspoon.com

89 INTERIM REPORT 2017