Whitbread (LSE:WTB) reported a positive start to the 2026-27 financial year, with growth across its Premier Inn hotel operations in both the UK and Germany helping lift group sales despite an anticipated decline in food and beverage revenues.
Total group sales increased 2% to £727 million during the first quarter, supported by strong accommodation demand and continued expansion of the company’s hotel portfolio.
UK Hotels Continue to Outperform Market
Premier Inn’s UK business delivered a 3% increase in accommodation sales, benefiting from robust leisure travel demand and continued market share gains.
The hotel chain maintained its revenue per available room (RevPAR) premium over the wider midscale and economy hotel sector, reinforcing its position as one of the strongest-performing brands in its market segment.
Whitbread also reported encouraging booking trends, with forward reservations running ahead of the prior year. London hotels continued to outperform regional locations, supported by sustained demand across both leisure and business travel segments.
German Expansion Drives Double-Digit Growth
In Germany, Premier Inn generated 16% accommodation sales growth on a sterling basis as the business continued to scale its presence in the market.
During the quarter, Whitbread opened six new leasehold hotels, expanding its footprint and supporting further revenue growth.
The company said its German operations continued to outperform the local midscale and economy hotel market on a RevPAR basis, reflecting increasing brand recognition, operational maturity and effective commercial initiatives.
Management believes Germany remains a significant long-term growth opportunity as the business builds scale in one of Europe’s largest hotel markets.
Confidence Maintained in Full-Year Outlook
Whitbread reiterated confidence in its outlook for the current financial year, citing favourable supply conditions across both its UK and German markets.
Management said demand trends remain supportive and believes the company is well positioned to benefit from continued growth in domestic and international travel.
The group continues to focus on operational execution while advancing strategic initiatives designed to improve profitability and enhance shareholder returns.
Five-Year Strategy Targets Cash Generation and Efficiency
Whitbread is progressing its recently announced five-year plan, which aims to transform the business into a more focused hotel operator.
Key objectives include completing the exit from branded restaurant operations, improving margins, reducing capital intensity and enhancing returns on invested capital.
The company has outlined ambitions to lower capital requirements by approximately £1 billion and generate around £2 billion of free cash flow by the 2031 financial year.
Management believes these initiatives will strengthen the group’s financial profile while supporting long-term value creation for shareholders.
More about Whitbread
Whitbread is a UK hospitality company best known for operating the Premier Inn hotel brand. The group is one of the largest providers of midscale and economy accommodation in the UK and is expanding rapidly in Germany. Whitbread is pursuing a strategy focused on hotel operations, including the gradual exit from branded restaurant businesses, with the aim of improving profitability, increasing cash generation and delivering stronger shareholder returns over the long term.
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