Costa owner Whitbread sees strong growth despite unimpressive restaurant results

Costa Coffee and Premier Inn owner Whitbread has reported strong interim results, with profit before tax up 12.6 per cent at £216.1m and a 12.4 per cent revenue increase in the six months to August. (Release)

Whitbread, who also owns Beefeater Grill, saw like-for-like sales up 2.8 per cent for the period, and have increased their interim dividend by 11.8 per cent.

The company says it is on track for its 2016 and 2018 milestones and ‘to deliver this year's business plan’.

Costa saw 153 net new coffee shops, taking the worldwide total to 2,680. Underlying profit was up 20.5 per cent to £43.5m, with like-for-like sales up 5.5 per cent. During the period, the company celebrated the opening of its 1,000th Costa international store in Bangkok.

Analysts at Numis, highlighting Costa's "excellent performance" and solid performance in China (which saw like-for-likes up 5.5 per cent) said this morning that it expects modest upgrades for the company, following the encouraging results.

Premier Inn opened 1,368 net UK rooms taking the total to 53,039. The 2016 milestone of 65,000 is, says Whitbread, in sight. Total sales were up 12.2 per cent, with like-for-like up 3.3 per cent.

1,200 new UK jobs were created by Whitbread brands over the six months, with a further 10,000 expected over the next three years.

However, restaurant performance saw flat year-on-year results, in line with expectations for the weather impacted sector. Total sales for the period were up 2.9 per cent to £269.9 million.

Chairman Anthony Habgood said:

This is another good set of results with our leading brands going from strength to strength. We continue to have high levels of customer satisfaction and brand preference together with excellent employee engagement. Our financial strength enables us to invest consistently in the business and gain market share while maintaining prudent debt levels.