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Whitbread cheers improving Premier Inn demand despite ‘softer’ weekends

Whitbread said total group sales increased by 1% to £739 million for the three months to May 30 (Mike Egerton/PA)
Whitbread said total group sales increased by 1% to £739 million for the three months to May 30 (Mike Egerton/PA)

Hotel and pub firm Whitbread has said trading improved across its UK Premier Inn hotels in recent weeks.

Nevertheless, the London-listed firm said demand was “slightly softer” during the weekend in some areas, such as London, which had performed particularly well last year.

The company, which also runs the Beefeater and Brewers Fayre brands, said total group sales increased by 1% to £739 million for the three months to May 30, compared with the same period last year.

Whitbread told investors sales were 1% down year on year over the first seven weeks of the quarter, but saw accommodation demand recover to match the previous year.

“While midweek business demand and peak leisure demand remained robust, weekend demand at short-lead was slightly softer, particularly in London, reflecting a return to more normalised levels after what was a very strong performance last year,” Whitbread said on Tuesday.

Its Premier Inn business in Germany reported a 15% increase in total sales.

Dominic Paul, chief executive of the hospitality group, said: “Whilst the normal booking pattern means our forward visibility remains limited, our forward booked position is positive and we remain confident in the full-year outlook.

“This reflects a more encouraging trading performance in the UK, our strong commercial programme and increased cost efficiencies, as well as good progress in Germany.”

Food and beverage sales were 1% lower year on year, as strong breakfast sales at hotels were offset by weaker trading in some branded restaurants.

Mr Paul added that Whitbread is on track with the programme restructure its food and beverage business announced earlier this year, which will close or convert more than 200 restaurants and cut about 1,500 jobs.

The plan is also designed to add more than 3,500 hotel rooms across its estate and increase “operational efficiencies”.

Analysts at Jefferies said the firm’s latest performance “came in slightly ahead of our estimates”.