Value offers drive Whitbread's pub business

Beefeater operator Whitbread said its 375-strong pub restaurant business put in a "robust performance" in the first six months of its financial year, despite what chief executive Alan Parker described as the toughest trading conditions for years.

Looking ahead, Parker said it was his company's view that the current tough economic climate would be in place for the foreseeable future, although he added the group's pubs were continuing to trade where they left off at the end of the first half.

Total turnover for the hotels and pubs to coffee shop group rose 3.1 per cent in the six months to August 27, 2009, to £703.3m, although like-for-like sales dipped nearly three per cent.

Pre-tax profits fell 10.4 per cent to £110.5m.

Overall sales across Whitbread's pubs rose 6.5 per cent, excluding the 44 sites it sold to Mitchells & Butlers last year. Like-for-like sales rose 1.8 per cent compared with a 4.8 per cent rise in the same period last year.

Parker said the group's pubs, 331 of which share a site with a Premier Inn hotel, "continued to deliver a robust performance as customers appreciate our attractive value propositions".

Nearly seven per cent more customers visited a Whitbread pub in the period than last year, with average like-for-like spending per head on food of £8.83.

The group's strategy was to balance margin management with offering value-for-money meals to price conscious customers, Parker said.

The group's Beefeater brand celebrates its 35th anniversary this year, and was "standing the test of time", he added.

Whitbread's Costa coffee retail operation saw like-for-like turnover rise 2.5 per cent in the period, versus 3.7 per cent last year, while the group's Premier Inn business saw overall revenues up 0.4 per cent.

The group's shares were up 42p at 1,332p.