Analyst Wyn Ellis, of Numis, has said Whitbread’s performance for the 50 weeks to 12 February was ahead of consensus in all area except its Restaurant arm.
He said: Whitbread’s FY15 pre-close update is strong with total sales growth in Q4 of 14.3% and LFLs of 5.8% (Q3 sales +13.2% and LFL’s +6%) despite being up against tough comps. Management says it expects “to deliver full year results towards the top end of current expectations”.
In Q4 LFLs increased by 8.6% at Premier Inn, 0.6% at Restaurants and 5.8% at Costa. We believe that the LFL performance was ahead of consensus in all areas other than in Restaurants. Whitbread notes that Premier Inn and Costa continue to grow rapidly, winning UK market share, with Premier Inn also benefiting from the recovery in the UK regional hotel market.
“Premier Inn grew total sales by 16.5% and LFL sales by 8.6% in Q3. There was a 6.9% increase in UK rooms and an 8.9% growth in RevPAR with room rate up 4.3%. In 2015/16 WTB expects to open a further c.5,500 new UK rooms (ahead of our 5,000 room expectation).
“Restaurants were a slight disappointment in Q4, with LFL sales growth of 0.6%. Covers were down 0.4%. A good Christmas trading was off-set by a softer January
“Costa had a strong Q4 with total sales growth of 16.2% (17.5% at constant currency) and LFL sales growth of 6.9%. International system sales grew by 10.9%.
“We would expect modest upgrades to consensus forecasts. We have not yet adjusted our forecasts, The shares are on 21.5x FY16 earnings (before any upgrades after today’s update). Not cheap but still a great investment.”
