Whitbread has reported a 2.6% increase in like-for-like sales for the year to 1 March 2012, on the back of continued growth at Costa Coffee, but said that trading had been variable during the year and that it expected that trend to continue. Total group sales increased by 11.2% to £1.7bn during the year on the back of new openings and like-for-like sales growth. Premier Inn sales grew by 8.3% to £755.9m, Restaurants by 1.8% to £483.4m and Costa by 27.5% to £541.9m. In what the group described as a “challenging economic environment” underlying pre-tax profit increased by 11.3% to £320.1m. Like-for-like sales at Costa climbed 5.5% during the year, in which it opened 332 net new stores; 175 in the UK and 157 overseas taking its total number of Costa stores to 2,203. Underlying profits at Costa climbed 38% to £69.7m during the year, and worldwide system sales increased 24.3% to £819.3m. Earlier this year, the group split Costa into four divisions: Costa UK Retail; Costa Enterprises (which includes wholesale, corporate franchise and Costa Express); Costa EMEI (which covers operations in Europe, Middle East and India); and Costa Asia, which it said reflected the “increasing breadth and globalisation of the brand and supports our growth strategy for the future”. It said that Costa UK Retail had delivered “consistently good” like-for-like sales growth across all channels and regions. Key drivers of success included further investment in the estate with some 128 refurbishments and the rollout of new store designs including four Metro stores. It opened five drive thru sites during the year and believes there is an opportunity for a further 70 locations. The group said that Costa Express had a good year with growth ahead of its original expectations. It said that typically, the number of cups sold per machine increased by around 20% once it was rebranded to Costa Express from Coffee Nation. There are now 1,192 Costa Express machines in the UK, which includes 622 conversions. Whitbread plans to roll out more than 1,000 Costa Express machines in 2012/13 supported by a new contract with Shell for over 500 machines. Costa's EMEI region now has a total of 647 stores including 95 in India and 93 in Poland. In the year 88 net new stores were opened. It said that Costa Asia had seen strong growth in China with 69 net stores opened in 2011/12 taking the total to 164, with plans to open a further 100 stores in the year ahead. The group expects China to break even in the second half of 2012/13. Whitbread plans to open 350 Costa stores in 2012/13 putting its “well on track” to achieve its growth milestones of £1.3bn system sales, 3,500 stores worldwide and around 3,000 Costa Express machines by 2015/16. The company said that like-for-like sales across its restaurants division, which includes Beefeater and Brewer’s Fayre, fell by 0.2% during the year, with the first half of the year described as “disappointing”. However, the division saw an improvement in performance in the second half of the year, with like-for-like sales up 1.2% during the second half of the year and covers up 4.8%. During the year, the group appointed a dedicated management team for the division, which it said had helped drive sales, operational excellence and cost efficiencies. New initiatives included the continued roll out of the Buffet Place concept within its Brewers Fayre estate. A total of 71 sites were converted in the year taking the total to 95 and these achieved an average sales uplift of 6% on conversion The group opened 12 new pub restaurant sites in the year, taking its total to 387, and plans to open a further six new sites in 2012/13. Like-for-like sales at Premier Inn's like for like sales growth of 3.2% was impacted by a slowdown in the total hotel market in the second half of the year, particularly in the regions. The company said that its openings across its hotels and restaurants division over the last three years had shown good returns as new sites matured and the return on capital for the division increased slightly to 12.4%. Return on capital in Costa grew to 32.4%, up from 28.3%. Capex during the year stood at £307.9m with Hotels and Restaurants spend amounting to £244.2m and Costa £63.7m. Whitbread said it expects capital expenditure for the year ahead to be at similar levels to 2011/12. In addition. It plans a further sale and leaseback, similar in size to that in the last financial year. Last August, the group sold seven Premier Inn sites to real estate investment company LaSalle Investment Management for £53.8m in a sale and leaseback deal. The group’s Board recommended a final dividend payment of 33.75p per share, making a total dividend for the year of 51.25p per share, an increase of 15.2%. Andy Harrison, chief executive, said: “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%, 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 2011/12 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.”