Whitbread accepts offers on 51 sites for £56m
The announcement has been made after the group said it would put 126 venues on the market and axe 1,500 jobs in April this year.
The news comes during the release of the group’s annual results for the first half of its 2025 financial year (H1) for the 26 weeks to 29 August 2024.
Whitbread said it remains “on course to realise expected proceeds from property-related transactions of between £175m and £225m in FY25”.
Meanwhile, revenue stayed flat with sales of £1.570m for the period versus £1.574m for H1 FY24 while total F&B sales fell by 7% as the group expected.
Adjusted profit before tax fell 13% to £340m v £391m in H1 FY24 while adjusted EBITDAR (earnings before interest, taxation, depreciation, amortisation and restructuring or rent costs) dropped by 3% from £628m in H1 FY24 to £611m.
Soft start
In current trading for the (six weeks to 10 October 2024), Whitbread said it had seen “an improving trend across the current trading period, after a soft start to September, with the result that total UK accommodation sales for the first six weeks were down 1% versus last year”.
F&B sales were down 14% in the period for the Premier Inn operator, reflecting the impact of its accelerating growth plan that includes optimisation of its F&B plan and increase efficiencies by converting 112 lower-returning branded restaurants into new hotel rooms and exiting 126 sites.
The group said of its five-year plan to 2030 it expects to increase adjusted profit before tax versus FY25 by at least £300m and generate more than £2bn for dividends, share buy-backs and, if suitable opportunities arise, additional high-returning investments.
Whitbread chief executive Dominic Paul said: “We are making excellent progress with our plans and over the next five years are set to deliver a step-change in our performance that will fund significant returns to shareholders.
“In the UK, we have a clear pathway to further extend our market-leading position and capitalise on the favourable UK supply backdrop.
“We are determined to build on our significant outperformance since the pandemic and while the market has been slightly softer than last year, we remain on course to grow our UK returns substantially over the medium-term.”
Not immune
Commenting on Whitbread’s results, Julie Palmer, Partner at Begbies Traynor, said: “Whitbread has reported uncharacteristically soft trading in what is usually seen as peak season, with a 13% fall in adjusted profit before tax.
“Evidently, the Premier Inn owner is not immune to the trends that have plagued the industry as it reported a 4% decrease in RevPAR (revenue per available room), as consumers keep a close eye on their wallets in anticipation of Labour’s inaugural budget.
“Unfortunately, Premier Inn’s leading position in the UK hotel market has not been enough to protect Whitbread from the recent downturn in consumer spending and lower demand for its hotels, restaurants and pubs.
“In spite of the challenging backdrop, Whitbread has made encouraging strategic progress in moving away from its poorer performing individual restaurants and focusing on the hotels business with targets to add a further 98,000 rooms to its estate by FY30.
“If the economy continues to stabilise and consumer confidence begins to rebuild, Whitbread’s emphasis on hotel expansion should position it well for increased demand for travel and accommodation over the vital Christmas period.”
