Where next for Wetherspoon's?
Pub company JD Wetherspoon has had a tough time since founder and chairman Tim Martin shocked the City in September 2003 by starting a six-month sabbatical.
Since March, Martin has returned as a part-time, non-executive chairman, but still Wetherspoon's financial performance has been lacklustre.
At the end of October the former City darling reported that its first-quarter like-for-like sales were down by 0.3% - the first fall since 1998. Worryingly, the company said its net operating margins were about two percentage points lower for the three-month period compared with the same period the previous year.
Chief executive John Hutson, who took over the reins from Martin, announced at the same time that he planned to stem the company's rapid growth. Having grown by an average of 55 sites a year for the past 10 years - to a total of 646 - it now plans to add just 15 new sites over the next 12 months.
Another blow to its expansion came late last year when the company announced it was scrapping plans for the Republic of Ireland and sold its single planned pub site in Dublin, losing more than £600,000 in the process.
All this is a far cry from the late 1990s, when the company was courted due to its rapid growth and buoyant figures.
Shares in the company were trading at more than £3 in April, but are now resolutely stuck in the 230-240p region. Some analysts, such as Nigel Popham of investment bank Teather & Greenwood, believe the stock is still overpriced, and the number of brokers who have the company as a "sell", as opposed to a "buy", is about five to one.
Peel Hunt analyst Paul Hickman reduced his recommendation from a "buy" to a "hold" rating last week, following the company's latest announcement about the poor performance of its September promotional campaign, which introduced new products and discounted offerings, such as Carling lager at £1.49 a pint.
Hickman described the situation between the company and the City as "tricky". He pointed out that every time the company makes a profit warning or negative statement, causing the share price to go down, it then goes into the market and buys shares. This suggests the company aims to go private at some point - something JD Wetherspoon denies.
The company has blamed its recent poor performance on everything from price competition to spiralling labour and utility costs, but analysts point to fundamental flaws in its strategy.
Its budget pricing strategy has seen it attempt to compete head-on with the supermarkets with limited success - most notably during the Euro 2004 football championships. The company reported flat like-for-like sales during the 11 weeks to 11 July, hampered by its policy of having TV sets in only a small proportion of bars.
JD Wetherspoon has also come under pressure from Government ministers who claim its cheap prices encourage binge-drinking. In spite of this, the company steadfastly refuses to introduce a minimum-pricing policy similar to that introduced by rival Yates Group last month.
However, financial director Jim Clarke said there were "encouraging signs" for the future - not least the fact that overall sales grew by 3% to £200.5m in the first quarter to 24 October.
"We're going to turn it around through marketing initiatives, new products and freshening up the food and bar offerings," said Clarke, stressing that the firm had no plans to make any radical changes to its strategy.
However, he admitted that one such marketing initiative, September's promotion, had got off to a "slow" start. "We're absolutely confident about the future. Like any market, it goes through peaks and troughs," added Clarke. "We'll just stick to the basics and get on with it. Every business matures, and we're no different from anyone else."
Hickman wasn't convinced. "Most people agree they have a very good management team, but for the first time you have a chink in the armour. Maybe the old magic isn't there any more."
