A TWIN-boost from consumers and businesses looking to save money in the gathering economic slowdown has helped drive a 7 per cent lift in like-for-like sales at Premier Inn and Beefeater parent Whitbread.
The leisure group said its budget hotel chain Premier Inn outperformed the market with a 10.2 per cent lift in like-for-like sales in the 24 weeks to 14 August.
Sales at the hotel business have slowed since a first-quarter rise of 10.7 per cent,
but Whitbread said its efforts to introduce lower-price food at its restaurant arm saw sales rise by 4.4 per cent, up from 3.6 per cent in the first three months.
Whitbread, which recently announced a swap deal with pubs firm Mitchells & Butlers to offload restaurants in return for hotels, said business travellers now accounted for 60 per cent of revenues at Premier Inn.
The trend towards business custom helped send average revenues per room – a key hotel industry barometer – up 5.8 per cent as corporate customers stay longer and spend more, Whitbread said.
But the firm's Costa Coffee operation saw a slowdown in like-for-like sales growth, at 3.7 per cent against 6 per cent in Q1.
City analysts say that the Costa business may be the first of the divisions to feel the pinch amid a downturn as consumers cut down on discretionary spend.
But Whitbread said: "We are well aware that times are tough and are keeping our eyes open. We are watching very carefully and if we need to take action to keep our business going in the right direction we'll take the action required."
The company announced a plan to save £25 million last February, partly through reducing labour costs, merging the management of its hotel and pub restaurant and businesses, and outsourcing logistics systems.
Whitbread said it had also seen energy costs rise 20 per cent and food costs 7 to 8 per cent.
Whitbread has overhauled its pub restaurant menus to offer lower-cost meals for customers and has also been rebranding many of its Brewers Fayre restaurants under its new Table Table format.
One analyst commented: "Whitbread looks a good bet in a difficult climate."
The full article contains 382 words and appears in The Scotsman newspaper.
