J D Wetherspoon plc

INTERIM REPORT 2012

FINANCIAL HIGHLIGHTS

Revenue up 8.4% to £569.4m (2011: £525.4m)

Like-for-like sales up 2.1% and profit up 1.2%

Operating profit before exceptional items* up 7.2% to £53.1m

Operating profit up 1.9% to £50.5m

Operating margin before exceptional items* 9.3% (last year: 9.4%)

Operating margin 8.9% (last year: 9.4%)

Profit before tax and exceptional items* up 11.1% to £35.8m

Profit before tax up 3.1% to £33.2m

Earnings per share before exceptional items* up 22.4% to 20.2p

Basic earnings per share up 10.9% to 18.3p

Free cash flow per share 27.5p (last year: 16.9p)

20 pubs opened, 2 sold, creating a total of 841

*Exceptional items as disclosed in account note 5.

CHAIRMAN'S STATEMENT AND OPERATING REVIEW

In the 26 weeks ended 22 January 2012, like-for-like sales increased by 2.1%, with total sales, including new pubs, increasing by 8.4% to £569.4 million (2011: £525.4 million). Like-for-like bar sales increased by 3.4% (2011: increased by 0.6%), like-for-like food sales were up 0.1% (2011: increased by 7.4%) and machine sales decreased by 3.8% (2011: decreased by 3.8%).

Operating profit before exceptional items increased by 7.2% to £53.1 million (2011: £49.6 million) and after exceptional items increased by 1.9% to £50.5 million (2011: £49.6 million). The operating margin before exceptional items was slightly lower at 9.3% (2011: 9.4%). Costs increased in several areas, especially in taxation, but also in labour, utilities and bar and food supplies. The operating margin after exceptional items was 8.9% (2011: 9.4%).

Profit before tax and exceptional items increased by 11.1% to £35.8 million (2011: £32.2 million) and after exceptional items increased by 3.1% to £33.2 million (2011: £32.2 million). Earnings per share before exceptional items increased by 22.4% to 20.2p (2011: 16.5p), as a result of fewer shares in issue and a reduced corporation tax charge, while basic earnings after exceptional items increased by 10.9% to 18.3p (2011: 16.5p).

As explained below, in 'Taxes and regulation', the company paid taxes of £250.1 million in the period under review, 43.9% of sales, compared with £225.7 million in the same period last year, which was 43.0% of sales. Taxes, therefore, amounted to a multiple of 10.7 times this year's profit after tax, compared with 10.2 times last year, mainly as a result of higher VAT, excise duty and carbon tax.

Net interest was covered 3.1 times by operating profit before exceptional items (2011: 2.9 times) and 2.9 times by operating profit after exceptional items (2011: 2.9 times). Total capital investment was £60.5 million in the period (2011: £54.9 million), with £41.7 million on new pub

openings (2011: £38.3 million) and £18.8 million on existing pubs (2011: £16.6 million).

Exceptional items before tax totalled £2.6 million (2011: £nil). The exceptional items relate to an IT-related asset write-off of £1.9 million, an insurance excess payment of £0.3 million (in respect of a pub which suffered a fire) and a provision for the loss on disposal of two trading pubs of £0.4 million.

Free cash flow, after capital investment of £18.8 million in existing pubs and payments of tax and interest, increased to £34.9 million (2011: £22.7 million), due mainly to a higher working capital inflow. Free cash flow per share was 27.5p (2011: 16.9p).

Property

In the period, we opened 20 new pubs and closed two (an airport lease expired and one pub was sold), bringing the number of open pubs at the period end to 841. We now intend to reduce the number of openings to around 40 in this financial year. Over the next few months, we will review our plans for pub openings in future financial years, taking account of our concerns for the tax régime, referred to below, on pubs.

Dividends

The board declared an interim dividend of 4.0p per share for the current interim financial period ending 22 January 2012 (2011: 4.0p). The interim dividend will be paid on 23 May 2012 to shareholders on the register at 27 April 2012. The dividend was covered 4.6 times by profit.

Corporation tax

We expect the overall corporation tax charge for the financial year, including current and deferred taxation, to be approximately 28.5% before exceptional items (July 2011: 30.2% before exceptional items and after excluding the effect of the tax-rate change), due to the UK standard weighted average tax rate for the period falling by 1.6% to 25.7%. As in previous years, the company's tax rate is higher than the standard UK tax rate mainly due to depreciation not eligible for tax relief.

We expect the company's current tax rate (excluding deferred tax) to be approximately 28.7% (July 2011: 28.7%), partly due to the planned capital allowances rates reduction of 2% on 1 April 2012 and also lower estimated tax relief, in respect of free share awards to be granted later in the financial year.

Financing

As at 22 January 2012, the company's net bank borrowings (including finance leases) were £456.6 million, an increase of £18.9 million, compared with the previous year end (24 July 2011: £437.7 million). Our debt-to-EBITDA ratio was 2.99 times at the period end, compared with 2.98 times at the previous financial year end.

'..98% of our pubs are now also accredited by Cask Marque – an excellent quality-assurance system to monitor and report on the condition of ale in pubs.'

Taxes and regulation

The table below breaks down the taxes paid in the period, in comparison with both last year and our profit after tax:

	11/12 First half £m	10/11 First half £m
VAT	115.6	95.1
Alcohol duty	65.6	61.6
PAYE and NIC	32.8	32.9
Business rates	21.0	20.2
Corporation tax	9.0	11.1
Machine duty	1.6	1.5
Fuel duty	1.3	1.3
Carbon tax	1.2	0.0
Climate-change levy	0.6	0.8
Stamp duty	0.6	0.5
Landfill tax	0.6	0.5
Premise licence and TV licences	0.2	0.2
TOTAL TAX	250.1	225.7
TAX AS % OF SALES	43.9%	43.0%
NET PROFIT AFTER TAX (£m)	23.3	22.1
NET PAT AS % OF SALES	4.1%	4.2%

The company is concerned by the absolute level of taxes and by their continuing increases, especially since supermarkets pay virtually no VAT, in respect of food purchases, while pubs pay 20%, in effect creating an enormous tax boost for supermarkets, enabling them to cross-subsidise drinks prices. Since VAT was increased from 8% to 15% over 30 years ago, and following further more recent increases to 20%, the pub industry has increasingly struggled to compete. Over that period, pubs have lost approximately half of their beer sales to supermarkets.

This tax, and hence price, disparity has been felt more acutely in less-well-off areas of Britain, where price disparities matter more – and the number of closed pubs in these locations is clearly evident. This, undoubtedly, has a knock-on effect for other businesses in small towns and secondary shopping centres, contributing to closed shops and reduced economic activity.

As well as generating large amounts of tax, pubs create large numbers of jobs, far more per pint or meal than supermarkets do, so the current tax subsidy makes no economic sense. The situation is exacerbated for pubs by the recent huge increases in excise duty (the tax paid on alcoholic drinks) in recent years, meaning that excise duty in this country is far higher than that in France, for example, with adverse consequences for tourism and the economy generally.

Punitive excise duty increases are often justified by the erroneous argument that they discourage binge drinking by raising consumer prices. In fact, the opposite has occurred: as pub prices go up, following duty increases, customers turn to supermarkets, decreasing the AVERAGE price which consumers pay for drinks.

It is now widely perceived that the previous and current governments' attempts to control binge drinking by a 'crackdown' on pubs have been misconceived and counterproductive. Pubs are not perfect, but generally try to create a supervised and civilised environment for drinking, usually preferable to streets, parks, parties and homes. The government needs to end the supermarket tax subsidy and to aim for excise duties to match the European average.

Further progress

The company continues to try to upgrade every area of the business. We have invested £18.8 million in refurbishments of existing pubs, new IT systems and equipment. For example, we have recently introduced plate-warmers and upgraded our pubs' glass-washers, cutlery and crockery.

Other areas of progress include the national launch of an apprenticeship scheme which has provided employment opportunities for 500 young people. In total, we have created 3,040 new jobs in the last 12 months. Our support for CLIC Sargent continues – and we have now raised over £5.2 million for this worthwhile cause.

We now have 238 pubs listed in CAMRA's Good Beer Guide, the greatest number in our history and more than any other pub company. In this connection, 98% of our pubs are now also accredited by Cask Marque – an excellent quality-assurance system to monitor and report on the condition of ale in pubs.

We are running what we believe to be the world's biggest beer festival, starting on 14 March 2012, featuring 50 beers, including those from America, Belgium, Norway, Russia and South Africa. In general, we continue, at all of our pubs, to be a major supporter of microbreweries and their excellent products.

We continue to upgrade our catering business and are introducing a new menu in late March, featuring 30 dishes at under 700 calories each. Our marketing efforts will also emphasise positive aspects, including free-range eggs, sustainable cod, haddock and salmon, Rainforest-Alliance-certified coffee, dolphin-friendly tuna and 100% British and Irish steaks and beef burgers.

Current trading and outlook

The outcome for the first half of the financial year was reasonable, given the pressures on the UK consumer.

As previously stated, the main challenges for the company, in this financial year of 53 trading weeks, will be the continuing cost pressures resulting from government legislation, including further increases to excise duty, business rates and carbon tax.

Sales since our 18 January 2012 pre-close statement have been disappointing, with like-for-like sales in the six weeks to 4 March declining by 0.7% and total sales increasing by 6.1%. As previously stated, we expect the operating profit margin before exceptionals to decline in the second half of this financial year due to continuing cost increases, with the current quarter particularly affected. We are, therefore, slightly more cautious about the potential outcome for the current financial year.

Tim Martin

Chairman 9 March 2012

	Notes	Unaudited 26 weeks ended 22 January 2012 £000	Unaudited 26 weeks ended 23 January 2011 £000	Audited 52 weeks ended 24 July 2011 £000
Revenue	4	569,375	525,364	1,072,014
Operating costs		(516,259)	(475,795)	(969,705)
Operating profit before exceptional items	6	53,116	49,569	102,309
Exceptional items	5	(2,599)	–	(5,389)
Operating profit		50,517	49,569	96,920
Finance income		27	14	36
Finance costs		(17,334)	(17,362)	(35,564)
Profit before tax	7	33,210	32,221	61,392
Income tax expense		(9,926)	(10,079)	(14,600)
Profit for the period		23,284	22,142	46,792
Earnings per share (pence) Basic earnings per share Diluted earnings per share	8	18.3 18.3	16.5 16.5	35.4 35.4

All activities relate to continuing operations.

STATEMENT OF COMPREHENSIVE INCOMEfor the 26 weeks ended 22 January 2012

	Notes	Unaudited 26 weeks ended 22 January 2012 £000	Unaudited 26 weeks ended 23 January 2011 £000	Audited 52 weeks ended 24 July 2011 £000
Interest-rate swaps: (loss)/gain taken to equity	13	(6,638)	11,045	3,511
Tax on items taken directly to equity		1,660	(2,983)	(2,466)
Net (loss)/gain recognised directly in equity		(4,978)	8,062	1,045
Profit for the period		23,284	22,142	46,792
Total comprehensive income for the period		18,306	30,204	47,837

Notes	Unaudited 26 weeks ended 22 January 2012 £000	Unaudited 26 weeks ended 22 January 2012 £000	Unaudited 26 weeks ended 23 January 2011 £000	Unaudited 26 weeks ended 23 January 2011 £000	Audited 52 weeks ended 24 July 2011 £000	Audited 52 weeks ended 24 July 2011 £000
Cash flows from operating activities Cash generated from operations 9 Interest received Interest paid Corporation tax paid Purchase of own shares for share-based payments	79,173 17 (16,478) (8,968) –	79,173 17 (16,478) (8,968) –	70,133 14 (16,805) (11,115) (2,913)	70,133 14 (16,805) (11,115) (2,913)	178,197 39 (34,020) (21,215) (5,783)	178,197 39 (34,020) (21,215) (5,783)
Net cash inflow from operating activities	53,744	53,744	39,314	39,314	117,218	117,218
Cash flows from investing activities Purchase of property, plant and equipment Purchase of intangible assets Purchase of lease premiums Proceeds of sale of property, plant and equipment Investment in new pubs and pub extensions	(14,986) (3,838) – 250 (41,666)	(14,986) (3,838)	(14,773) (1,801) (750) – (37,569)	(14,773) (1,801)	(31,787) (6,613) (825) 1,100 (86,793)	(31,787) (6,613)
Net cash outflow from investing activities	(60,240)	(18,824)	(54,893)	(16,574)	(124,918)	(38,400)
Cash flows from financing activities Equity dividends paid 14 Proceeds from issue of ordinary shares Purchase of shares for cancellation Advances under bank loans 13 Finance costs on new loan 13 Finance lease payments 13	(10,475) 46 – 18,199 (2,711) (2,038)		– 77 (1,217) 16,363 – (1,391)		(5,211) 225 (32,759) 49,962 – (2,908)
Net cash inflow from financing activities	3,021		13,832		9,309
Net change in cash and cash equivalents 13	(3,475)		(1,747)		1,609
Opening cash and cash equivalents Closing cash and cash equivalents	27,690 24,215		26,081 24,334		26,081 27,690
Free cash flow		34,920		22,740		78,818
Free cash flow per ordinary share 8		27.5p		16.9p		59.7p

	Notes	Unaudited 22 January 2012 £000	Unaudited 23 January 2011 £000	Audited 24 July 2011 £000

Assets Non-current assets
Property, plant and equipment	10	907,800	830,396	881,271
Intangible assets	11	12,908	7,932	11,525
Deferred tax assets		17,229	14,782	15,569
Other non-current assets	12	10,350	10,601	10,520
		948,287	863,711	918,885
Current assets
Inventories		20,282	19,488	21,488
Other receivables		25,597	26,359	21,623
Assets held for sale		145	–	70
Cash and cash equivalents	13	24,215	24,334	27,690
		70,239	70,181	70,871
Total assets		1,018,526	933,892	989,756
Liabilities Current liabilities Trade and other payables		(185,143)	(152,832)	(189,777)
Financial liabilities due in one year		(3,545)	(2,863)	(3,129)
Current income tax liabilities		(10,505)	(10,151)	(9,457)
Non-current liabilities		(199,193)	(165,846)	(202,363)
Financial liabilities		(477,300)	(427,572)	(462,254)
Derivative financial instruments	13	(64,518)	(50,346)	(57,880)
Deferred tax liabilities		(71,358)	(76,060)	(71,448)
Provisions and other liabilities		(25,067)	(23,447)	(24,766)
		(638,243)	(577,425)	(616,348)
Net assets		181,090	190,621	171,045
Shareholders' equity
Ordinary shares	15	2,632	2,777	2,632
Share premium account		143,245	143,053	143,199
Capital redemption reserve		1,798	1,652	1,798
Hedging reserve		(48,388)	(36,759)	(43,410)
Retained earnings		81,803	79,898	66,826
Total shareholders' equity		181,090	190,621	171,045

STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY

	Called-up share capital £000	Share premium account £000	Capital redemption reserve £000	Hedging reserve £000	Retained earnings £000	Total £000
At 25 July 2010	2,783	142,975	1,646	(44,821)	59,558	162,141
Profit for the period	–	–	–	–	22,142	22,142
Interest-rate swaps
– profit taken to equity Tax on items taken directly to equity	– –	– –	– –	11,045 (2,983)	– –	11,045 (2,983)
Comprehensive income	–	–	–	8,062	22,142	30,204
Exercise of options	–	78	–	–	–	78
Cancellation of shares	(6)	–	6	–	(1,217)	(1,217)
Share-based payment charges	–	–	–	–	2,328	2,328
Purchase of shares held in trust	–	–	–	–	(2,913)	(2,913)
At 23 January 2011	2,777	143,053	1,652	(36,759)	79,898	190,621
Profit for the period	–	–	–	–	24,650	24,650
Interest-rate swaps
– loss taken to equity	–	–	–	(7,534)	–	(7,534)
Tax on items taken directly to equity	–	–	–	883	(366)	517
Comprehensive (loss)/income	–	–	–	(6,651)	24,284	17,633
Exercise of options	1	146	–	–	–	147
Cancellation of shares	(146)	–	146	–	(31,542)	(31,542)
Share-based payment charges	–	–	–	–	2,267	2,267
Purchase of shares held in trust	–	–	–	–	(2,870)	(2,870)
Dividends	–	–	–	–	(5,211)	(5,211)
At 24 July 2011	2,632	143,199	1,798	(43,410)	66,826	171,045
Profit for the period	–	–	–	–	23,284	23,284
Interest-rate swaps
– loss taken to equity	–	–	–	(6,638)	–	(6,638)
Tax on items taken directly to equity	–	–	–	1,660	–	1,660
Comprehensive (loss)/income	–	–	–	(4,978)	23,284	18,306
Exercise of options	–	46	–	–	–	46
Share-based payment charges	–	–	–	–	2,168	2,168
Dividends	–	–	–	–	(10,475)	(10,475)
At 22 January 2012	2,632	143,245	1,798	(48,388)	81,803	181,090

1. General information

J D Wetherspoon plc is a public limited company, incorporated and domiciled in England and Wales. Its registered office address is: Wetherspoon House, Central Park, Reeds Crescent, Watford, WD24 4QL

The company is listed on the London Stock Exchange.

This condensed half-yearly financial information was approved for issue on 9 March 2012.

These interim financial results do not comprise statutory accounts within the meaning of Sections 434 and 435 of the Companies Act 2006. Statutory accounts for the year ended 24 July 2011 were approved by the board of directors on 9 September 2011 and delivered to the Registrar of Companies. The report of the auditors, on those accounts, was unqualified, did not contain an emphasis-of-matter paragraph and did not contain any statement under Sections 498 to 502 of the Companies Act 2006.

The business is subject to minor seasonal fluctuations, depending on public holidays and the weather.

There are no changes to the principal risks and uncertainties as set out in the financial statements for the 52 weeks ended 24 July 2011, which may affect the company's performance in the next six months. The most significant risks and uncertainties relate to the taxation on, and regulation of, the sale of alcohol, cost increases and UK disposable consumer incomes. For a detailed discussion of the risks and uncertainties facing the company, refer to the annual report for 2011, pages 42 and 43.

2. Basis of preparation

This condensed half-yearly financial information of J D Wetherspoon plc (the 'Company'), which is abridged and unaudited, has been prepared in accordance with the Disclosure and Transparency Rules of the Financial Services Authority and with International Accounting Standards (IAS) 34, Interim Financial Reporting, as adopted by the European Union. This half-yearly condensed financial report should be read in conjunction with the annual financial statements for the 52 weeks ended 24 July 2011 which have been prepared in accordance with IFRSs, as adopted by the European Union.

The directors have made enquiries into the adequacy of the Company's financial resources, through a review of the Company's budget and medium-term financial plan, including capital expenditure plans and cash flow forecasts; they have satisfied themselves that the Company will continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going-concern basis in preparing the Company's financial statements.

The financial information for the 52 weeks ended 24 July 2011 is extracted from the statutory accounts of the Company for that year.

The interim accounts for the 26 weeks ended 22 January 2012 and the comparatives for 23 January 2011 are unaudited, but have been reviewed by the auditors. A copy of the review report is included at the end of this report.

3. Accounting policies

Taxes on income in the interim periods are accrued using the tax rate which would be applicable to expected total annual earnings.

The accounting policies adopted in the preparation of the interim report are consistent with those applied in the preparation of the Company's annual report for the year ended 24 July 2011.

The following new standards, amendments to standards or interpretations are mandatory for the first time for the financial year beginning 25 July 2011, but are not relevant for the Company:

■ Amendments to IFRS 7 'Financial instruments: Disclosures on derecognition'

■ Amendments to IAS 24 (revised) 'Related-party disclosures'

■ Prepayments of a minimum funding requirement (amendments to IFRIC 14)

4. Revenue

Revenue disclosed in the income statement is analysed as follows:	Unaudited 26 weeks	Unaudited 26 weeks	Audited 52 weeks
	ended	ended	ended
	22 January	23 January	24 July
	2012	2011	2011
	£000	£000	£000
Sales of food, beverages and machine income	569,375	525,364	1,072,014

The Company trades in one business segment (that of operating managed public houses) and one geographical segment (being the United Kingdom).

5. Exceptional items

	Unaudited	Unaudited	Audited
	26 weeks	26 weeks	52 weeks
	ended	ended	ended
	22 January	23 January	24 July
	2012	2011	2011
	£000	£000	£000

Operating items
Impairment of property and fixed assets	–	–	4,410
Loss on disposal of property, plant and equipment	666	–	979
Write-off of IT-related assets and other software costs	1,933	–	–

	2,599	–	5,389

The intangible assets written off in the period relate primarily to the development cost of software which is no longer being implemented.

6. Operating profit before exceptional items

This is stated after charging/(crediting):	Unaudited 26 weeks ended 22 January 2012 £000	Unaudited 26 weeks ended 23 January 2011 £000	Audited 52 weeks ended 24 July 2011 £000
Operating lease payments
– land and buildings
■ minimum lease payments	25,735	25,607	50,502
■ contingent rents	6,940	6,899	13,586
– equipment and vehicles	230	183	375
Repairs and maintenance	20,073	17,726	36,241
Rent receivable	(251)	(272)	(565)
Depreciation of property, plant and equipment
– owned assets	21,928	19,351	40,460
– assets held under finance leases	1,082	1,485	2,406
Amortisation of intangible assets	620	569	1,223
Amortisation of non-current assets	159	150	306
Share-based payment charges	2,467	2,328	4,595

7. Income tax expense

The taxation charge for the period ended 22 January 2012 is calculated by applying an estimate of the effective tax rate before exceptional items of 28.5% for the year ending 29 July 2012 (2011: 31.3%). The UK standard weighted average tax rate for the period is 25.7% (2011: 27.3%), with the latest estimate of the current tax payable on profits for the financial year ending 29 July 2012 being 28.7% (2011: 30.3%).

	Unaudited	Unaudited	Audited
	26 weeks	26 weeks	52 weeks
	ended	ended	ended
	22 January	23 January	24 July
	2012	2011	2011
	£000	£000	£000
Current tax	10,288	9,766	19,169
Current tax on exceptional items – intangible asset write-off	(272)	–	–
Deferred tax Origination and reversal of timing differences Impact of change in UK tax rate	(90) –	313 –	980 (5,549)
Tax charge in the income statement	9,926	10,079	14,600

8. Earnings and free cash flow per share

Basic earnings per share has been calculated by dividing the profit attributable to equity holders of £23,284,000 (January 2011: £22,142,000; July 2011: £46,792,000) by the weighted average number of shares in issue during the period of 127,004,632 (January 2011: 134,456,866; July 2011: 132,019,936).

The weighted average number of shares has been adjusted to exclude treasury shares held in respect of the employee Share Incentive Plan.

Earnings before exceptional items per share has been calculated before exceptional items detailed in note 5 and takes account of 3,708 (January 2011: 27,936; July 2011: 23,250) potential dilutive shares under option, giving a weighted average number of ordinary shares, adjusted for the effect of dilution, of 127,008,340 (January 2011: 134,484,802; July 2011: 132,043,186).

Adjusted earnings for the 52 weeks ended 24 July 2011 excludes an adjustment of £5,549,000, in respect of the corporation tax-rate change and exceptional items.

Earnings per share	January	January	July	January	January	July
	2012	2011	2011	2012	2011	2011
	Earnings	Earnings	Earnings	EPS	EPS	EPS
	£000	£000	£000	pence	pence	pence
Basic earnings/diluted earnings	23,284	22,142	46,792	18.3	16.5	35.4
Adjusted earnings before exceptional items	25,611	22,142	46,632	20.2	16.5	35.3
Adjusted earnings after exceptional items	23,284	22,142	41,243	18.3	16.5	31.2

Free cash flow per share

The calculation of free cash flow per share is based on the net cash generated by business activities and available for investment in new pub developments and extensions to current pubs, after funding interest, tax, all other reinvestment in pubs open at the start of the period and the purchase of own shares under the employee share-based schemes ('free cash flow'). It is calculated before taking account of proceeds from property disposals, inflows and outflows of financing from outside sources and dividend payments and is based on the same number of shares in issue as that for the calculation of basic earnings per share.

9. Cash generated from operations

	Unaudited	Unaudited	Audited
	26 weeks	26 weeks	52 weeks
	ended	ended	ended
	22 January	23 January	24 July
	2012	2011	2011
	£000	£000	£000
Operating profit	50,517	49,569	96,920
Operating exceptional items	2,599	–	5,389
Operating profit before exceptional items	53,116	49,569	102,309
Depreciation and amortisation	23,789	21,555	44,395
Share-based payment charges	2,168	2,328	4,595
Change in inventories Change in receivables Change in payables	79,073 1,207 (3,677) 2,570	73,452 423 (3,640) (102)	151,299 (1,577) (1,896) 30,371
Net cash inflow from operating activities	79,173	70,133	178,197

10. Property, plant and equipment

	£000
Net book amount at 25 July 2010	810,714
Additions	44,094
Disposals	(3,576)
Depreciation	(20,836)
Net book amount at 23 January 2011	830,396
Additions	78,614
Disposals and transfers to assets held for sale	(4,951)
Depreciation, impairment and other movements	(22,788)
Net book amount at 24 July 2011	881,271
Additions	50,653
Disposals and transfers to assets held for sale	(1,114)
Depreciation	(23,010)
Net book amount at 22 January 2012	907,800

11. Intangible assets

	£000
Net book amount at 25 July 2010	6,700
Additions	1,801
Amortisation, impairment and other movements	(569)
Net book amount at 23 January 2011	7,932
Additions	4,255
Amortisation, impairment and other movements	(662)
Net book amount at 24 July 2011	11,525
Additions	3,745
Write-off of IT-related assets	(1,742)
Amortisation, impairment and other movements	(620)
Net book amount at 22 January 2012	12,908

Intangible assets all relate to computer software and development.

12. Other non-current assets

10,350	10,601	10,520
22 January	23 January	24 July
2012	2011	2011
£000	£000	£000
26 weeks	26 weeks	52 weeks
ended	ended	ended
Unaudited	Unaudited	Audited

13. Analysis of changes in net debt

	24 July	Cash	Non-cash	22 January
	2011	flows	movement	2012
	£000	£000	£000	£000
Cash at bank	27,690	(3,475)	–	24,215
Debt due after one year	(457,522)	(15,488)	(850)	(473,860)
Finance lease creditor	(429,832)	(18,963)	(850)	(449,645)
	(7,861)	2,038	(1,162)	(6,985)
Net borrowings	(437,693)	(16,925)	(2,012)	(456,630)
Derivative – cash flow hedge	(57,880)	–	(6,638)	(64,518)
Net debt	(495,573)	(16,925)	(8,650)	(521,148)

The £6.6-million non-cash movement on the interest-rate swap arises from the movement in fair value of the swaps.

During the period under review, the Company entered into additional forward-starting interest-rate swap agreements, totalling £250 million, in addition to the existing swaps which expire in 2014 and 2016, respectively. The weighted average interest rate of the new swaps is 2.4%, from November 2014 to July 2018.

14. Dividends paid and proposed

	Unaudited 26 weeks ended 22 January 2012 £000	Unaudited 26 weeks ended 23 January 2011 £000	Audited 52 weeks ended 24 July 2011 £000
Paid in the period 2011 interim dividend 2011 final dividend	– 10,475	– –	5,211 –
Dividends paid	10,475	–	5,211
Dividends in respect of the period Interim dividend Final dividend	5,080 –	5,211 –	– 10,475
	5,080	5,211	10,475
Dividend per share	4p	4p	8p

15. Share capital

	Number of shares 000s	Share capital £000
Opening balance at 25 July 2010 Allotments	139,125 23	2,783 –
Repurchase of shares	(290)	(6)
Closing balance at 23 January 2011	138,858	2,777
Allotments	45	1
Repurchase of shares	(7,295)	(146)
Closing balance at 24 July 2011	131,608	2,632
Allotments	14	–
Closing balance at 22 January 2012	131,622	2,632

All issued shares are fully paid.

16. Related-party disclosure

There were no material changes to related parties' transactions described in the last annual financial statements. There have been no related-party transactions having a material effect on the Company's financial position or performance in the first half of the current financial year.

17. Capital commitments

The Company had £nil capital commitments for which no provision had been made, in respect of property, plant and equipment, at 22 January 2012 (2011: £nil).

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors confirm that this condensed interim financial information has been prepared in accordance with IAS 34, as adopted by the European Union, and that the interim management report includes a fair review of the information required by DTR 4.2.7 and DTR 4.2.8, namely:

■ an indication of important events which have occurred during the first 26 weeks and their impact on the condensed set of financial statements, plus a description of the principal risks and uncertainties for the remaining 26 weeks of the financial year.

■ material related-party transactions in the first 26 weeks and any material changes in the related-party transactions described in the last annual report.

The directors of J D Wetherspoon plc are listed in the J D Wetherspoon annual report for 24 July 2011. A list of current directors is maintained on the J D Wetherspoon plc website: www.jdwetherspoon.co.uk

By order of the board

John Hutson Kirk Davis

9 March 2012 9 March 2012

Introduction

We have been engaged by the company to review the condensed set of financial statements in the half-yearly financial report for the 26 weeks ended 22 January 2012, which comprises the Income Statement, the Statement of Comprehensive Income, the Cash Flow Statement, the Balance Sheet, the Statement of Changes in Shareholders' Equity and related notes. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority.

As disclosed in note 2, the annual financial statements of the company are prepared in accordance with IFRSs as adopted by the European Union. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting", as adopted by the European Union.

Our responsibility

Our responsibility is to express to the company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review. This report, including the conclusion, has been prepared for and only for the company for the purpose of the Disclosure and Transparency Rules of the Financial Services Authority and for no other purpose. We do not, in producing this report, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 22 January 2012 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority.

PricewaterhouseCoopers LLP

Chartered Accountants 1 Embankment Place London WC2N 6RH

9 March 2012

Notes:

(a) The maintenance and integrity of the J D Wetherspoon plc Web site is the responsibility of the directors; the work carried out by the auditors does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for any changes which may have occurred to the financial statements since they were initially presented on the website.

(b) Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.