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Whitbread, the owner of Premier Inn, said forward bookings in the UK and Germany are ahead of last year as it advances plans to close its remaining branded restaurants, trim capital expenditure and boost returns to shareholders. The update comes while the group faces activist pressure and broader headwinds across British hospitality.
Bookings and summer outlook
The company reported that forward bookings in its two largest markets are rising compared with the prior year, and like-for-like sales increased by 2% for the 13 weeks to May 28. Despite saying visibility remains limited, Whitbread said it is confident about its full-year performance.
Whitbread reports Premier Inn forward bookings ahead of last year
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Chief executive Dominic Paul highlighted a stronger demand picture for the summer. “We’re in a good position for this summer,” he told analysts, noting that higher airline fares could encourage more people to holiday at home.
The war in Iran, described by the company as a source of global uncertainty and inflationary pressure, has pushed up travel costs. That dynamic may benefit Whitbread: almost 90% of its revenue comes from the UK.
Cost cutting and capital decisions
Whitbread has outlined a plan to reduce capital spending by £1 billion and to return £2 billion of free cash flow to shareholders by fiscal 2031. In April the group said it would close its remaining branded restaurants, a move that could affect around 3,800 jobs.
The company framed the moves as a way to sharpen its focus on the hotel business and free cash for investors while protecting the core Premier Inn brand.
Activist demands and business rates
Activist investor Corvex Management has pressed Whitbread to consider a sale and a broader strategic review, citing recent budget changes that increased costs and, in its view, created a valuation gap.
Paul said the firm is engaging with ministers over the business rates changes. In a statement he added: “Whilst we expect the impact of business rates to remain in line with our previous FY27 guidance, we are continuing to press the UK Government for changes to FY28 and FY29.”
What it means for customers and investors
Analysts note the ending of the Iran conflict this week could bolster consumer confidence and sustain domestic travel demand, supporting Whitbread’s hotel revenue. Peel Hunt analyst Ivor Jones said the development is “probably positive for Whitbread.”
For investors, the combination of cost cuts, capital discipline and a shareholder return plan aims to narrow the gaps highlighted by Corvex. For customers, the near-term effect may be a continued focus on the UK hotel offer rather than branded dining options.
