16th Oct 2025 09:00
(Alliance News) - Whitbread PLC on Thursday backed full year guidance despite "limited visibility", some uncertainty around the forthcoming UK budget and reduced guidance for its German business.
In response, shares in the Bedfordshire-based hotel and restaurant company fell 8.9% to 2,938.00 pence each in London on Thursday morning. The wider FTSE 100 was down 0.2%.
The Premier Inn owner said pretax profit fell 7.1% to GBP287 million in the half-year to August 28, from GBP309 million 12 months earlier.
On an adjusted basis, pretax profit fell 7.1% to GBP316 million from GBP340 million, 4% ahead of GBP305 million consensus, with adjusted earnings per share down 2.5% to 133.7 pence from 137.1p.
The FTSE 100 listing said this reflected broadly flat UK total accommodation sales and positive momentum in Germany, offset by the anticipated lower food and beverage sales due to the continued implementation of its 'accelerating growth plan'.
Revenue declined 1.8% to GBP1.54 billion from GBP1.57 billion, but beat GBP1.53 billion consensus.
Premier Inn UK total accommodation sales were broadly in line with last year and revenue per available room was down 1% reflecting a soft first quarter followed by a return to market growth in the second quarter.
At Premier Inn Germany, sales grew by 9% and despite softer than expected market demand, pretax losses narrowed to GBP3 million from GBP9 million.
Whitbread said its five-year plan is on track to deliver incremental adjusted pretax profit of at least GBP300 million by financial 2030.
The firm delivered GBP43 million of cost savings in the financial first half and remains on course to deliver GBP250 million of savings by financial 2030, it added.
Looking ahead, Whitbread said it remains "confident" in the full year outlook.
"While forward visibility remains limited and despite some uncertainty around the forthcoming UK budget, positive trading momentum and encouraging levels of bookings into future periods in both the UK and Germany mean we remain confident in the full year outlook," the firm said in a statement.
But it lowered expectations for its German business and now expects full year adjusted pretax profit of up to GBP5 million, versus previous guidance of GBP5 million to GBP10 million.
In the UK, higher than expected cost inflation will be partially mitigated by increased cost efficiencies of GBP65 million to GBP70 million, versus previous guidance of GBP60 million, so that net inflation remains within the previously guided range of 2% to 3% on its GBP1.7 billion UK cost base.
In the six weeks to October, Whitbread said Premier Inn UK accommodation sales and RevPAR were both up 3% year-on-year with a strong performance in London that benefitted from a number of events in the period, including the Oasis concerts.
The forward booked position is ahead of last year, and Whitbread said it remains confident in maintaining a "healthy" RevPAR premium versus the market.
But food and beverage sales are 4% down year-on-year, although Whitbread said this was in line with expectations, reflecting the removal of a number of lower-returning branded restaurants.
In addition, Whitbread provided an updated property valuation of GBP5.5 billion to GBP6.4 billion.
The dividend was left unchanged at 36.4p per share while Whitbread pledged to return GBP2 billion via share buy-backs and dividends by financial 2030. It said it was on track to complete the previously announced GBP250 million share buy-back by the end of April 2026.
By Jeremy Cutler, Alliance News reporter
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