Whitbread reports strong start to 2008

Leisure group Whitbread has reported a strong start to the year despite reports of an economic downturn.

Premier Inn and Pub Restaurants have both performed well for the group which saw overall sales increase by 14.6 per cent and 7.1 per cent like for like for the 13 weeks to May 29.

Whitbread Chief Executive Alan Parker, who was awarded a CBE in the Queen`s Birthday Honour`s list yesterday, said the hotel chain was continuing to outperform the market. Sales increased year on year by 18.3 per cent and like for like were up 10.7 per cent.

He said: "Revenue per available room has increased by 6.2 per cent with 8.3 per cent more rooms sold due to hotel expansion. The rebranding exercise is close to completion and has been well received. Sales through our Business Account card have grown by 40 per cent year on year as corporate travellers recognise Premier Inn’s value for money price and quality."

Parker said the rising cost of food had put pressure on gross margins at its restaurant chains, which include Beefeater, Brewers Fayre and the newly launched Table Table brands, but nevertheless total sales for Pub Restaurants grew 5 per cent with like for like sales up 3.6 per cent.

To drive covers growth, the group said it had introduced cheaper options to menus which helped move like for like covers up almost 7 per cent.

Coffee chain Costa saw the strongest growth with total sales up by 28.4 per cent year on year.

"The attractiveness of our brands to guests has been demonstrated by our good performance to date. We remain cautious, however, should the consumer environment become more challenging. The resilience of our businesses combined with cost actions we have taken, our investment pipeline and our strong balance sheet put us in a good position to continue the disciplined development of the group," said Parker.