* Q2 lfl sales up 3 percent vs 1.6 percent rise in Q1
* Expects reasonable outcome for full year
* Chairman says market forecasts for FY are realistic
* Chairman says no sign yet of impact from VAT hike
* Shares up 5.8 percent
(Adds CEO, analyst comment, shares)
By Matt Scuffham
LONDON, Jan 19 (Reuters) - UK pubs operator JD Wetherspoon said sales growth in the second quarter picked up pace as pints of beer costing less than one pound ($1.60) and its cheap breakfasts lured more cash-strapped customers.
Wetherspoon, which has bucked the trend of declining sales and profits across the pubs sector over the past three years, said it was confident of a reasonable performance in 2011.
Other operators have suffered the combined impact of a recession, a smoking ban, and cheap alcohol offers in supermarkets, causing around 40 pubs to close each week, according to the British Beer and Pub Association (BBPA).
In the face of such pressures, Wetherspoon, which has nearly 800 pubs across Britain, has continued to grow sales and profits and is pressing ahead with plans to open 50 pubs a year for the next five years.
"Sales, profit and cashflow continue to be resilient and the performance of our recently opened pubs remains encouraging," said chairman Tim Martin, who founded the business with the opening of a single London pub in 1979.
The company said sales at pubs open more than a year rose by 3 percent in the 12 weeks to Jan. 16, compared with a 1.6 percent increase in the first quarter to Oct. 24.
Wetherspoon, the first of Britain's major pub companies to report on Christmas and New Year trading, said heavy snow across the country had impacted sales but the effect on its comparative performance had been minimal because it was offset by similarly bad weather hitting sales in January last year.
"The underlying proposition that snow on the ground and very cold weather is bad for the pubs trade is completely true. Were it not for the fact that it was offset by snow a year ago it wouldn't look as good," Martin told Reuters in an interview.
"We're probably less affected than most because we're in the middle of towns. The best snow clearing and the best transport is normally in cities and towns," he added.
Martin said there was no sign yet of any impact on trade from January's hike in VAT sales tax but he suggested there may be an effect as the full implications of the rise hit consumers.
"I don't think people react to 5 or 10 pence necessarily overnight. As their finances tighten as time goes by it may have an effect because they're not paying VAT just on a pint. They're paying it on more or less everything," he said.
Given economic uncertainties and increases in the cost of supplies, Martin said a wide range of market expectations for the company's full year pretax profit was realistic.
Analysts forecasts range between 66 and 79 million pounds with the average at 70 million, according to a Thomson Reuters I/B/E/S poll.
Shares in Wetherspoon, which have risen by over 20 percent over the last two months, were up 5.8 percent to 467-1/2 pence at 1033 GMT.
"Wetherspoon's ability to trade through what many thought was worse snow than last year suggests its value model is in good shape," said Peel Hunt analyst Paul Hickman. (Editing by Kate Holton; Editing by Louise Heavens) ($1=.6251 Pound)