Whitbread's profits jump as Premier Inn-owner enjoys steady demand

By Eva Mathews

(Reuters) -Whitbread posted a 44% rise in half-year profit on Wednesday helped by strong demand for its Premier Inn hotels and resilient consumer spending at its restaurants.

Shares in the British company, originally a brewer, were up 3.5% to 3,437 pence by 0737 GMT to lead London's blue-chip index.

CEO Dominic Paul said the company was not seeing issues with customers due to higher prices, adding 86% of its customers in the first half were repeat visitors.

Leisure and business demand are showing signs of staying, Paul said, adding forward-booked revenue was ahead of last year.

A recovery in international travel following the easing of pandemic restrictions has been further buoyed by a strong pound, as well as flexible work arrangements that have encouraged mini-breaks and longer trips.

Travellers are also opting for established hotel chains over independent properties, some of which have not reopened after the pandemic, Whitbread has noted.

"In the UK, supply is not expected to get back to pre-pandemic levels for at least five years, so there's space for selective site expansion without crushing margin," Hargreaves Lansdown analyst Derren Nathan said.

The company, which operates more than 840 hotels across UK and Germany, said adjusted profit before tax rose to 391 million pounds in the first half from 272 million pounds a year earlier.

Whitbread, which owns restaurant chains such as Bar+Block Steakhouse and Brewers Fayre has also seen signs of food inflation easing.

The company announced a further 300 million pound share buyback on Wednesday and proposed an interim dividend per share of 34.1 pence, up 40% on last year.

($1 = 0.8193 pounds)

(Reporting by Eva Mathews in Bengaluru; editing by Subhranshu Sahu and Jason Neely)