Premier Inn owner Whitbread has dropped from a £219.9m pre-tax profit in its 2020 financial year to a statutory loss of £724.7m in its interim first half results of 2021.
Statutory revenue was also down 76.9% to £250.8m and adjusted earnings before interest, tax, depreciation, amortisation and restructuring or rent costs (EBITDAR) dropped from £426.7m to a loss of £153.7m.
However, Whitbread said this was "in-line with expectations", reflecting the closure of most of its estate earlier this year, and insisted it "remains well-placed to capitalise on the enhanced structural growth opportunities" that will emerge. This includes the news it has signed 15 hotels in Germany currently operating under the Centro, Ninetynine and Fourside brands, which are expected to join Premier Inn in December.
Alison Brittain, Whitbread's chief executive, said: "Whitbread's long-term strategy remains as relevant and compelling as ever. The impact of the Covid pandemic on the hotel sector will undoubtedly be significant and we are already seeing signs of distress and constraint in the competitive landscape. This is likely to accelerate the structural changes in the market with supply contraction and constrained investment amongst independent and budget branded operators in both the UK and Germany.
"We hold a uniquely advantaged position in the UK market as the largest player with the strongest brand. Our financial flexibility and resilience, combined with a strong balance sheet, give us the ability and the confidence to invest with discipline and focus on strong long-term returns. We will be well placed to enhance our market leadership position even further in the UK, and accelerate our growth in Germany, supporting our guests and teams and driving long-term value for all our stakeholders."