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Whitbread likely to expand its Costa coffee chain stores

Costa expected to open another 1,000 stores

Whitbread's new chief executive Andy Harrison is likely to announce his intention of expanding the Costa coffee chain shop brand around the world.

According to the Times, Harrison will use a scheduled trading update tomorrow to outline the global potential of the Costa brand and update about his future plans to run both coffee shops and budget hotels.

Trade analysts speculated that Whitbread was also likely to pump more funds into the expansion of Costa, considering the global credentials of the brand and its potential to boost earnings, than in its Premier Inn division, where returns are lower.

Moreover, the Costa business was worth more to shareholders as part of the group and therefore Harrison had no plans as of now to sell Costa.

Costa, which is the biggest coffee shop operator in Britain, with about 1,100 stores, is expected to open another 1,000 stores in its home country and increase the number of its shops internationally over the next three to four years to about three times from the 500 that it currently operates.