City analysts have broadly welcomed Whitbread’s strong performance in 2009 - after the pub, restaurant and coffeeshop operator unveiled a 5.4% increase in group sales.
Whitbread said all its major brands, including Premier Inn, the budget hotel chain, and Costa, were now back in positive growth in a trading statement released yesterday.
Analysts are now forecasting pre-tax profits in the region of £235m, compared with £198m last year and last night shares in Whitbread were up by 5p or 2.5% worth 1472p.
It prompted chief executive Alan Parker, who will retire in November to be replaced by easyJet chief executive Andy Harrison, to say that “the fundamental prospects at Whitbread had never looked better”.
Whitbread’s Costa coffee has continued its recession defying performance with like-for-like sales 9.5% ahead in the fourth quarter and total sales in the full year 21% ahead of 2008.
Its pub restaurants, which include Beefeater, Table Table and Taybarns, produced like-for-like sales growth of 1.3% for the fourth quarter. Total sales for the 51 weeks to 18 February were up 5.2% on last year, excluding sales from 44 sites it has sold.
Analysts agreed with Parker’s outlook, maintaining buy recommendations for the stock. Numis said it was “encouraged”, Deutsche Bank noted “a very good run” for Whitbread, Barclay’s Capital retained the group as its top hotels pick for the sector, and Mark Brumby at Astaire said he was reassured by the performance in what has been a sticky period for consumer spending.
Wynn Elis at Numis said it was particularity encouraged by Premier Inn's like-for-like sales growth of 1.7%. Numis increased its target price from 1575p to 1650p and said it had also nudged its Costa expectations higher.
Panmure analyst Simon French also suggested the appointment of Harrison will “hasten the divestment of Costa”, which in turn will release cash to expand the successful Premier Inn brand further.
Speaking during an analyst briefing, Parker yesterday revealed that Roadchef’s recent announcement not to renew its ten-year management agreement with Premier Inn at 15 sites would cost Whitbread around half a million pounds in lost franchise revenue.
Roadchef is thought to have lined up Days Inn for when the agreement with Premier Inn ends this September.
