Whitbread to expand faster as profits jump 20pc

Pub and hotel operator Whitbread has pushed pre-tax profits up 20 per cent in the first quarter of 2010 and committed to further expansion in core brands such as Costa Coffee and Premier Inn.

Whitbread produced £287.1m underlying pre-tax profit, up from £239.1m in the same quarter in 2010, as like for like sales increased across all its businesses.

Group revenues rose 11.5 per cent to £1.6bn from £1.4bn in 2010, with like-for-like sales up 6.6 per cent.

“Our emphasis is on giving customers value for money, winning market share and keeping a tight control of costs,” said chief executive Andy Harrison.

“Despite a more challenging consumer economy, we are confident that we will continue to outperform.”

Harrison said the company saw a “significant opportunity” to grow based on its good capital returns and access to high quality UK development sites.

The group plans to add 4,000 new Premier Inn UK rooms and about 300 Costa stores this year, he said, with new targets to grow the number of Premier Inn UK rooms by 50 per cent to 65,000 and double the size of Costa to 3,500 stores worldwide over the next five years.

The new goal sits on top of the group’s current target of growing Costa Express outlets to 3,000.

The Whitbread Hotels and Restaurants business generated £283.4m operating profit, a 14.7 per cent rise on the same period in 2010, while Costa operating profits rose 38 per cent to £50.1m