Premier Inn owner Whitbread returns to profit
Premier Inn owner Whitbread has reported a pre-tax profit of £307.4m on revenues of £1.35b for the first half of its financial year, compared to a loss of £19.3m for the same period the previous year.
The group said that a declining independent sector meant was increasing its growth potential in the UK and Ireland, and so it was boosting its long-term target from 110,000 to 125,000 rooms, with plans "on course" to add 1,500-2,000 rooms in the UK this financial year.
Total UK accommodation sales were 101% ahead of last year's first half and 35% ahead of the group's 2020 financial year first half.
Food and beverage sales were 95% ahead of the same period last year but 5% behind pre-pandemic levels, and Whitbread said the UK value pub restaurant sector remained "challenging". The group said its initiatives to return sales to pre-pandemic levels were "unlikely" to be achieved this year.
The business also said the combination of additional inflation in areas such as labour, utilities and F&B, together with brought forward investments in IT and marketing, will result in increased costs of £60m this year.
Alison Brittain, Whitbread chief executive, said: "We delivered an outstanding trading performance in the first half of the year, with revenues and profit before tax above pre-pandemic levels. Our UK hotels traded well-ahead of the market, benefiting from our 'investing to win' commercial and operational initiatives that are continuing to drive growth."
She added: "The strength of our balance sheet underpins our success and has given us the confidence to continue to invest, even through the periods of great uncertainty that we have seen over the past few years. Our investment in growing our estate, our customer proposition, commercial initiatives, IT systems and Force for Good sustainability programme has meant we have been able to take advantage of improved market conditions and extend our market leading position.
"Despite macroeconomic uncertainties, our current trading performance is strong and our business has proven its resilience in previous downturns. With a robust balance sheet and significant growth potential in both the UK and Germany, we remain confident in the full year outlook and our ability to deliver long-term value for all our stakeholders."