Pub group JD Wetherspoon has announced their full-year results, with chair, Tim Martin, announcing a general "reigning in" of the group’s expansion due to increased costs caused by the government introducing both higher levels of taxation and "misguided bureaucracy" to the pub industry.

Turnover was up 22 per cent to £730.9m, while operating profit rose seven per cent to £75m. Pre-tax profits, before exceptional items, were up five per cent £56.1m. Like-for-like sales showed a 4.1 per cent increase.

During the preliminary announcement by Martin and Wetherspoon finance director, Jim Clarke, attention was given to the positive aspects of the company’s trading, with an increase in the range of both wine and spirits on offer at Wetherspoon outlets, the continued development of food menus and growth of the Lloyds pub brand.

While Martin insisted that the group remained "confident about our own business", he admitted that the changes in licensing laws and increasing costs of stamp duty, rates and insurance were cause for concern. He said: "We’re cautious about the outlook and believe that it’s prudent to keep investment down until we see how the new regulatory and licensing issues pan out."

During the year, the group sold 18 pubs for a net cash consideration of £10.7m, giving rise to a loss on disposal of £2.7m. The value in the balance sheet has also been written down by £1.0m on two non-trading properties which were purchased for development and which Wetherspoons now intend to sell. Total exceptional loss in the year was calculated at £3.7m before taxation.

The company opened 45 pubs during the year – compared with 87 in the previous year – bringing the total number of pubs now operated by the company in Britain and Northern Ireland to 638. This includes three that have opened since the year end.

Pub operating margins are in line with the new increase in duty of 1p a pint, which Clarke said equated to an extra £2m a year in duty paid by the company. Other pub costs have risen year-on-year by 1.2 per cent from 2002, due to higher insurance, rates and repairs costs. Every Wetherspoon pub is said to require a minimum investment of £60,000 a year in maintenance.

The group’s cashflow, which remains fundamentally organic, has risen, while £2.5m has been spent on the replacement share option plan.

Commenting on the results, Martin said: "I am pleased to report another year of progress for Wetherspoon. As a result of our strong cash flow, our track record over many years and our excellent management team, I remain confident of our future prospects." Details: www.jdwetherspoon.co.uk