JD Wetherspoon reports £2.4m packaging waste costs under EPR scheme

JD Wetherspoon has disclosed that it expects to incur around £2.4 million in costs this year under the UK’s extended producer responsibility (EPR) scheme for packaging, according to its latest annual report.

The pub group said the figure represents a threefold increase on last year’s estimated cost of approximately £800,000. The additional expense stems from suppliers passing on the levy applied to packaging materials, including glass bottles and other forms of packaging.

The EPR legislation requires businesses that supply or import packaging into the UK to contribute towards the cost of collecting and recycling that packaging once it becomes waste.

Alongside the higher packaging compliance costs, Wetherspoon also cited increased energy bills as contributing factors to operational pressures, though the company said it would aim to limit the impact on prices for customers.

Commenting on the results, Tim Martin, chairman of JD Wetherspoon PLC, said: As previously indicated, increases in national insurance and labour rates will result in cost increases of approximately £60 million per annum, and non-commodity energy costs will add £7 million.

The recently introduced extended producer responsibility tax, a levy on packaging, referred to in the table on page 9, will cost £2.4 million in the current year, an increase of £1.6 million. Cost increases such as these will undoubtedly add to underlying inflation in the UK economy, although Wetherspoon, as always, will endeavour to keep price increases to a minimum.

Despite these rising costs, the group reported a positive financial performance, with revenue up 4.5% to £2.13 billion, like-for-like sales up 5.1%, and pre-tax profit rising 10.1% to £81.4 million for the year.