A leading analyst has said that he expects JD Wetherspoon to have traded relatively well over the first six weeks of FY 2013E and looks forward to news on plans for the redeployment of capex from the group’s scaled back opening programme. For the managed pub operator’s preliminary results, which are due on 14 September, Simon French at Panmure Gordon forecast £69.2m PBT (38.1p EPS) for FY 2012E broadly in line with consensus on £70.0m PBT (39.6p EPS). He said: “We expect the group to have traded relatively well over the first six weeks of FY 2013E reflecting indifferent weather and an unchallenging comp of 0.4%. We look for news on plans for the redeployment of capex from the scaled back opening programme. We think increasing dividends faster than earnings would be particularly well received by the market. On our forecasts the stock trades on a CY 2013E adj EV/EBITDAR of 7.1x and yields 2.9%. We reiterate our 515p target price, implying c14% potential upside. Buy.” At the pre-close IMS, JDW reported 6.1% LFL sales growth (total sales +11.9%) for the 11 weeks to 8 July compared to French’s forecast of 2%. He said: “This outperformance was driven by particularly strong trading around the Diamond Jubilee celebrations and Euro 2012. YTD LFL sales were +3.0%, total sales were +9.2% and EBIT margin was guided to 8.5% for H2 (H1: 9.3%), in line with our expectations and implying c8.8-8.9% for the full-year. The group opened 11 pubs in Q4 to bring the total for the year to 40; three pubs closed. “We think there is underlying top-line momentum in the business and margins should stabilise as the 176 pubs opened over the last four years mature and the drag from new pubs diminishes as the number of openings is reduced. However we note the group is aggressively discounting certain products (cider, wine, spirits and cocktails) between now and the end of Novemberwhich could depress gross margins. “On our forecasts the stock trades on a CY 2013E adj EV/EBITDAR of 7.2x (P/E 10.3x) and yields 2.8%. We reiterate our Buy recommendation and 515p target price, implying 14% potential upside.”