A leading analyst has said that the first quarter trading update due from Whitbread later this month should reassure the market, with its pub restaurant division set to deliver figures ahead of those reported by its more wet-led pub peer group.
Geof Collyer at Deutsche Bank, said: “The April lfls data from Coffer Peach Business Tracker for UK eating and drinking-out market fell by 2% year-on-year after rising 1.9% in March However, within the April mix, pubs were -4%, implying restaurants were ahead.
“April last year was very strong for the pub industry (the tracker was +3.8%), helped by great weather and the Easter/Royal Wedding fortnight. Whitbread’s restaurants delivered a -1.4% like-for-likes for Q1'12, so the greater eating-out exposure in the estate should mean that the division performs ahead of the recent dull numbers delivered by the more wet-led pub peer group.
Collyer said that given the travails on the High Street, he sees the pace of like-for-likes at Costa slowing down, but remaining comfortably ahead of those highlighted in the tracker
He said: “Costa, like Premier Inns, should get a considerable boost from new site rollout in the total sales growth. Total system sales, driven by growth in both managed and franchise stores, were +19% in FY'12. We are looking for a modest slowdown in this figure in FY'13E, although Costa has generally outperformed expectations.”
In Q1'12, Premier Inn delivered London RevPAR growth of
+8.8% and Regional growth of +1.2%. In the last period, Q4'12, these figures had fallen to +0.3% and -1.6%.
Collyer said: “STR data is deteriorating outside London and mixed inside, with maybe a soft comp for last April to blame along with the economy. RevPAR was -3.6% and -4.3% for March and April 2012 in Regional UK Midscale / Economy, and for London hotels, RevPAR in the same segment was -3.7% and +7.5% in March and April respectively. We still expect PI to outperform the peer group. Total revenues should benefit marginally from the new sites opened during the quarter.”
