Young's says NI, minimum wage changes to add £11m in annual costs

14th Nov 2024 09:52

(Sharecast News) - Pub chain Young's said on Thursday that changes to national insurance contributions and minimum wage announced in last month's Budget would add around £11m in annual costs from next April.

However, the company insisted it would not be passing the costs on to its customers.

"The new Government's budget will result in significant increased costs for our industry in the near term through rises in National Minimum Wage and Employer's NI payments," Young's said.

"We expect the cost impact to be approximately £11 million on an annualised basis from next April. We will work to see how we can mitigate these headwinds without passing on all the cost to our loyal customers. We would like to see certainty and delivery of real business rate reform which will benefit all hospitality businesses."

In its results for the 26 weeks to 30 September, Young's said adjusted operating profit rose 22.9% to £38.1m, while pre-tax profit ticked up 3.3% to £25.3m.

Revenue for the period rose 27.2% to £250m, with like-for-like revenue growth of 4.4%. Young's said this was "set against the challenging early spring and summer weather, supported by an excellent EURO 24".

Young's declared an interim dividend of 11.53p a share, up 6% on the same period a year earlier.

Chief executive Simon Dodd said: "We've achieved a huge amount as a business in the last six months, reflected in another strong set of results. The City Pub Group integration has gone well, with the pub teams welcomed into the Young's family and all operational control brought together under one leadership team. Our teams have done a fantastic job, and I'm looking forward to seeing our pubs thrive together.

"I am very pleased with our performance and the progress we have made during the period, which has been achieved despite some challenges. The weather was frustrating yet again, with a wet spring and limited periods of prolonged sunshine during the summer months, however EURO24 and England's successful run to the final, provided a welcome boost to drink sales with our pubs performing exceptionally well on match days."