Whitbread results: PI flat but Costa Coffee strong

Whitbread, owner of value hotel chain Premier Inn and Costa Coffee, has posted total sales up 2.5% in a trading statement for its first financial quarter.

Premier Inn

The sales are in line expectations but Premier Inn, which provides the largest share of sales, saw flat total sales for the quarter and like-for-like sales fall 7.9%. Revenue per available room dropped 9.6%.

Whitbread says that it has maintained sales via its Business Account card with total accounts rising 14% year-on-year and it plans a fresh assault on the leisure market.

The company launched its Premier Offers initiative recently with rooms starting at £29 per room and has also undertaken an aggressive comparative print campaign which targets its three and four star rival, such as Holiday Inn.

Costa Coffee, which has also been marketing aggressively with the line “7 out of 10 coffee lovers prefer Costa!” saw total sales up 18.5% year-on-year and like-for-like up 2.6%. Excluding airports Costa like-for-like sales rose 4.5%.

Whitbread’s pub restaurants saw like-for-like sales rise 2% with total sales, excluding 44 sites sold last year, up 7.4%.

Chief executive officer Alan Parker says: “We believe Whitbread’s brands are well placed in their markets, although the outlook is challenging. We will continue to play to our strengths and we are focused on three key priorities: to outperform our competition, to achieve cash flow neutrality and to reduce operating costs.”

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