Whitbread launches £1bn fundraise

The impact of Covid-19 on Whitbread’s full-year results is limited given the group’s February year-end. It cited weak business confidence and leisure consumer demand over its financial year as a drag on the UK travel market, and revenue per available room in its Premier Inn hotels fell 4.3 per cent to £43.91. This environment, twinned with the addition of 2,906 rooms, pushed occupancy rates down to 76.3 per cent from 77.9 per cent.

Whitbread acknowledged that it faces a tough year, admitting that “Covid-19 is expected to result in a very material loss of revenue”, with the possibility that the group is “materially loss-making”. Accommodation and food and beverage revenues were down 99 per cent in the last seven weeks. The group has slashed planned capital expenditure to around £250m from a previously guided £450m, while a monthly cash burn of £80m is expected in its first half, with most venues closed. It intends to use funds from its rights issue to forge ahead with its German pipeline, with part of its anticipated £130m in first-half capital payments to be spent on refurbishing German hotels acquired this year.

Broker Morgan Stanley forecasts full-year 2021 pre-tax losses of £260m.