Whitbread's pub restaurants boosted by value offers

Hotels and pub restaurant operator Whitbread said its focus on market outperformance, cost reduction and cutting debt had paid dividends, despite what it called the "most challenging trading conditions for a generation".

Investment in its pub restaurants, most of which are attached to Premier Inn hotel sites, helped boost annual revenues, details of which the group published today.

With five new sites opening in the year restaurant turnover for the year to March 4, 2010, rose 1.3 per cent to £466.2m, with like-for-like sales up 1.7 per cent, "driven by increases in average spend and like-for-like covers up 1.4 per cent".

An average of £125,000 per site was spent on an investment programme which saw 95 restaurants refurbished.

"Our restaurants have continued to achieve like-for-like growth, consistently outperforming the market," said Alan Parker, Whitbread's chief executive, who is due to retire in November.

"Customers have been attracted to the great value for money food and drink we offer in well-maintained environments," he added. The first seven weeks of the current financial year had "started well, with positive momentum across the business".

Meanwhile the group said total turnover for the year rose 7.5 per cent to £1,435m.

While overall like-for-like sales for the year were down half a per cent, Whitbread said trading had improved in the fourth quarter to the tune of 3.1 per cent.

Underlying pre-tax profits grew nearly seven per cent to £239.1m, earnings per share rose 6.7 per cent to 96.7p and the group plans to pay a full year dividend of 38p, up four per cent.

Costa, Whitbread's coffee shop chain, saw like-for-like sales up 5.5 per cent in what the group called an "outstanding year" for the concept.

Whitbread meanwhile announced it had reduced its net debt by nearly £110m to £513.4m.