Whitbread makes a value for money appeal to savvy consumers

Whitbread is looking ahead with measured optimism after announcing a group sales increase of 11.5% for the 50 weeks to 12 February 2009. The hotel and restaurant group said that it’s hard to establish what current consumer and economic trends are and will be paying a lot of attention to maintaining the sound financial footing of its business.

The group’s hotel and restaurant business served up a 5.4% increase in like-for-like sales, in its first year as a combined business. Premier Inn is attracting an increasing number of business customers, with its total business accounts up 48% year on year. In isolation, Premier Inn produced a 6.2% increase in like-for-like sales. Costa, Whitbread’s High Street coffee chain, frothed up a Grande sized increase in total sales of 22.1%, although the like-for-like figure was more primo sized at 2%. Whitbread opened up 204 new Costas in the UK in the 50 week period. It has expanded the brand internationally and now has 1,297 outlets across 25 world markets.

Speaking on the Radio 4 Today programme yesterday, Chief Executive, Alan Parker, said that the market is increasingly volatile and that consumers are becoming more ‘savvy’ in terms of the spending choices they make. To help see it through the cloudy climate, Whitbread is ensuring the underlying strength of its business. It aims to achieve cash flow neutrality by reducing organic expansion and reducing capital expenditure to around half that for 2007/8. It is also continuing with its efficiency programe, with the aim of saving £25 million by 2010/11. Finally, Whitbread aims to stay ahead of the competition by appealing to the savvy consumer with its budget brands. Overall, the company believes that its 2008 performance means that it is well placed for a challenging 2009. Whitbread’s brands include Premier Inn, Beefeater, Table Table, Brewers Fayre, Taybarns and Costa Coffee.

03 March 2009