Costa's expansion drives revenue boost for Whitbread
The British hotel and restaurant group's annual profit up 19.8 per cent.
The British hotel and restaurant group Whitbread has reported a profit of £266m for the full year ended 1 March 2012, an increase of 19.8 per cent compared to £222m for the same period last year.
Total revenue was up 11.2 per cent to £1.78bn (2011: £1.6bn), while operating profit was £345.7m (2011: £309.9m).
Whitbread’s strong performance – following a slump at its budget hotel group Premier Inn over the Christmas period – was largely due to the robust results of its café chain Costa, which has delivered more than 40 quarters of underlying sales growth in a row. Costa’s underlying profits were up 38 per cent to £69.7m, worldwide system sales up 24.3 per cent to £819.3m and like-for-like sales in UK equity stores up 5.5 per cent. The chain’s recent expansion saw the opening of 175 new UK outlets and 157 overseas.
Meanwhile, Premier Inn sales grew by 8.3 per cent to £755.9m. During the year, the company opened 4,055 new rooms in the UK and created 2,500 new jobs. Like-for-like revpar – revenue per available room – grew by 1.8 per cent, with an increase of 0.8 per cent in the regions and 7.3 per cent in London.
The hotels and restaurants division made steady progress with an increase in like-for-like sales of 1.2 per cent. Revenue grew by 1.8 per cent to £483.4m.
Andy Harrison, CEO of Whitbread, said:
Whitbread performed well in 2011/2012. Sales grew by 11.2 per cent, driven by our strong brands, with an increase in underlying pre-tax profits of 11.3 per cent. This profit growth, combined with our good return on capital, drove a strong cash inflow from operations of £478.3m. This funded reinvestment of £307.9m in maintaining and growing our estate, together with a 15.2 per cent growth in the full year dividend, whilst retaining our strong balance sheet.
In 2012, the company is planning to open 4,200 new Premier Inn UK rooms, six new restaurants and 350 new Costas worldwide.
We remain on track to achieve our five-year growth milestones. In Premier Inn UK, we have nearly 58,000 rooms in our existing estate and committed pipeline, taking us towards our 2016 milestone of 65,000 rooms. Last year, we grew Costa’s worldwide network by 18 per cent, well on the way towards our five year goal of doubling the size of Costa. This growth, combined with our strong focus on returns should create substantial shareholder value.
In the new financial year both Premier Inn and restaurants have shown positive like for like sales growth and Costa has continued its good momentum, both in the UK and internationally. Trading in 2011/2012 was variable month by month and we expect this to continue with short term comparatives affected by the phasing of bank holidays and the Olympics.
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