JD Wetherspoon has seen its share price drop by over 7% after it issued its fourth profit warning in seven months.

The pub and hotel operator stated in its pre-close trading update that in the 12 weeks to 19 July, its like-for-like (LFL) sales increased by 4% year-on-year.

In the year-to-date, LFL sales jumped by 4.2% and has opened eight pubs and sold nine in the same period, with a current portfolio of 793 managed pubs.

The firm said that it anticipates its year-end net debt to be £720m, which is in line with the end of the last financial year.

Chairman at Wetherspoons, Tim Martin, said: "Profits for the year are likely to be below market expectations, with marginally lower sales than anticipated in the final quarter, combined with higher costs in the areas of food, labour, repairs, energy and business rates."

Head of markets at AJ Bell, Dan Coatsworth, stated that when Martin is quiet, "you know something has gone wrong", especially following the World Cup, which should have given the pub sector a boost.

He concluded: "One would have thought Martin would use the trading update as an excuse to lay out his demands from the new government in how to help the pubs sector. But there is nothing but silence.

"He might be playing the waiting game given murmurs that Andy Burnham will announce lower business rates for pubs. It’s possible he doesn’t want to rock the boat before the new prime minister has had a chance to lay out his plans.

"Wetherspoons has always trodden carefully when it comes to dealing with cost pressures. Many companies would simply pass on extra costs to the customer through higher prices. Wetherspoons knows its unique selling point is favourable pricing, so it may not want to risk alienating customers by making its products too expensive. That means stomaching extra costs and taking a hit to profits."

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