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Whitbread toasts strong Q1 results despite restaurant closures
Whitbread’s sales grew overall by 1% in Q1 2024, driven largely by demand for its Premier Inn hotels, while food and beverage sales slightly lagged.
Earlier this year, Whitbread announced that it would be offloading 126 of its underperforming restaurants, which include Brewers Fayre and Beefeater sites, a move which also came at the expense of 1,500 jobs. As of the end of April, the group had agreed to the sale of 21 of these eateries for a value of around £28 million.
Overall, group sales grew by 1% compared by Q1 last year, reaching £739m, with notable growth of like-for-like sales accommodation sales in Germany (+6%). Like-for-like food and beverage sales also grew by +2% in Germany.
However, growth was rather more modest in the UK, with like-for-like accommodation sales dropping by -2%, and food and beverage sales slightly down (-1%).
Whitbread chief executive Dominic Paul noted that UK accommodation sales were still “ahead of the market”, and above pre-pandemic levels.
“In Germany, we delivered another strong performance, led by the increasing maturity of our estate and continued room growth,” Paul continued. “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.”
He cited “increased cost efficiencies” as a factor in the performance, and noted that the group’s Accelerating Growth Plan was to “add 3,500 rooms” in the UK – something that will be made possible by the offloading of the restaurants.
“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,” Paul concluded.
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