- Whitbread reports Q1 update, with Premier Inn outperforming
- Says Q1 trading was “very strong”
- Whitbread shares jump more than 5%
Whitbread released a first-quarter trading update Wednesday before the open, and as expected, the company reported “very strong trading.”
Whitbread owns brands such as Premier Inn, Hub by Premier Inn, Beefeater, Thyme Bar + Grill, and Table Table.
It was always going to perform positively, given it is benefitting from booming travel trends and social activities following the pandemic.
Even so, the company said it continued market outperformance in the UK, with Premier Inn total accommodation sales 27.2pp ahead of the market.
Overall, their hotels are performing impressively, “well ahead of pre-Covid levels.”
Here’s what Whitbread reported:
- Total UK accommodation sales 235.6% ahead vs FY22 (31.0% ahead vs FY20)
- UK LFL accommodation sales 221.6% ahead vs FY22 (21.3% ahead vs FY20)
- UK food and beverage sales were 585.3% ahead vs FY22 (4.3% behind vs FY20)
The hotel numbers are not surprising, given we have been banging on about booming travel for the last few months.
The company added that lifting restrictions has also seen the German hotel market recover more strongly than expected, with Premier Inn occupancy levels of 64.7% in the last four weeks of the quarter.
Whitbread said that given the tight labour market and its focus on maintaining its market-leading position, they plan to invest an additional £20m – £30m in labour, refurbishments, and IT in FY23.
However, the high levels of occupancy and continued strong sales performance mean it is confident in its continued margin recovery in the UK.
“The strength of Premier Inn’s recovery in the UK continues to be ahead of expectations with a particularly strong Q1 performance that is well ahead of pre-pandemic levels and we continue to significantly outperform the market,” said Alison Brittain, CEO of Whitbread.
Looking ahead, the company stated that based on improved visibility of the second quarter, where it is approximately 40% booked, it is “increasingly confident of delivering a strong first-half performance.”
However, they expect some additional costs due to targeted pay increases.
Whitbread also announced it has signed a new £775m revolving credit facility, replacing the previous £850m facility that was due to expire in September 2023.
Whitbread shares jumped over 5% in early Wednesday trading.
Key Stats:
At MoPh Markets, we online consumer data to understand trends and demand for a company’s products/services…
And as you can see from the chart above, Premier Inn’s website traffic has jumped significantly since April 2021, hitting its highest point since at least 2011/12, according to SemRush data.