In World Economy News 10/09/2016
The U.K. is in a stronger negotiating position than the European Union and should not insist on striking a trade deal with the 28-member bloc, according to the pro-Brexit founder of the JD Wetherspoon Plc pub chain.
EU countries sell twice as much goods to Britain as Britain sells back, meaning a trade deal with the bloc isn’t as important for the U.K. as it is for the EU, Wetherspoon Chairman Tim Martin said in a Bloomberg TV interview Friday. Martin has been one of the business community’s most vocal supporters of Britain’s vote to leave the EU.
His comments came as Wetherspoon forecast slightly improved results after full-year earnings beat estimates. Sunny weather and Britain’s record medal haul at the Rio Olympics put people in the mood for visiting the company’s 1,000 pubs, he said. The upbeat outlook was in contrast to rival Greene King Plc, which said Friday it sees tougher trading ahead because of Brexit uncertainty.
Martin has called the EU anti-democratic, and said economists such as Paul Johnson at the Institute for Fiscal Studies who made dire predictions about Brexit’s impact on Britain’s fiscal health “need to stick that point in their pipes and smoke it.” Goldman Sachs and Morgan Stanley, two of the banks Martin criticized prior to the referendum, have revised earlier downbeat predictions after recent economic data pointed to a recovery.
Robust Sales
Wetherspoon shares rose as much as 6 percent in London, the biggest intraday gain in two months, while Greene King fell as much as 5.5 percent. Wetherspoon’s full-year earnings before tax and exceptional items rose to 80.6 million pounds ($108 million), beating the average analyst estimate of 72.7 million pounds. Sales remain “robust,” Investec analyst Karl Burns said in a note, upgrading the shares to buy.
In July, Martin said former Prime Minister David Cameron and others in the Remain camp were practicing “irresponsible doom-mongering,” and earlier printed 200,000 beer mats for his pubs comparing the leadership of the International Monetary Fund with that of FIFA, world soccer’s embattled governing body.
Source: Bloomberg
