Whitbread has reported a -1% like-for-like sales decline in UK food & beverage sales in its first quarter trading update (Q1 2025).
The Beefeater and Brewers Fayre operator further reported strong breakfast sales in the 13 weeks to 30 May 2024, driven by high occupancy in hotels, but offset by softer trading in a number of branded restaurants.
Group total sales grew 1% to £739m, driven by improved UK trading and continued progress in Germany.
Lfl sales declined -2% in accommodation for the UK but increased 6% in Germany, led by the increasing maturity of the estate and continued room growth.
Trading performance strengthened following the first seven weeks of the quarter, with accommodation sales recovering to be in line with FY24 and up 55% vs FY20.
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 a strong performance last year.
The strength of the brand and the benefit of the commercial programme has led Whitbread to continue to outperform the market, with total accommodation sales growth 0.6pp ahead.
The Premier Inn operator remains confident in the full year outlook, with “more encouraging” recent trading as it moves into the peak periods of the year.
Whitbread also continues to execute its commercial programme and net inflation is now expected to be at the lower end of guidance as a result of increased cost efficiencies.
In April this year, the group announced it will invest £500m in a plan to exit 126 restaurants and convert 112 into hotel rooms.
Branded restaurants have been impacted by a reduction in footfall from non-hotel guests and have struggled to meet their targeted levels of return, Whitbread said at the time.
The Accelerating Growth Plan aims to optimise Whitbread’s F&B offer, unlock 3,500 room extensions and drive increased margins and returns
Chief executive Dominic Paul said: “Our UK trading results strengthened during the quarter and we continued to grow accommodation sales ahead of the market. Underpinned by the favourable supply backdrop, total accommodation sales and RevPAR remained significantly ahead of pre-pandemic levels. In Germany, we delivered another strong performance, led by the increasing maturity of our estate and continued room growth. Our cohort of more established hotels is continuing to outperform the M&E market and we remain on course to achieve the important milestone of reaching break-even on a run-rate basis during the second half of 2024.
“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.
“Our Accelerating Growth Plan to optimise F&B at a number of sites and add 3,500 rooms to our UK pipeline is on track and will increase our momentum to deliver long-term profitable growth. With significant potential in both the UK and Germany, supported by the structural reduction in supply and our asset-backed balance sheet, our strategic plans are set to deliver a step change in our performance.”
