Premier Inn owner Whitbread to cut 1,500 jobs amid growth plans

Whitbread, the owner of Premier Inn hotels, is to cut 1,500 jobs, equivalent to roughly 4% of its total UK workforce.

The losses would come with the budget hotel group’s plan to exit 126 branded restaurants over the next two years, having already agreed to sell 21 of these restaurants for £28m.

During the 2024 fiscal year ended 29 February, the 126 restaurants generated revenue of £147m and loss before tax of £9m.

The group will also convert 112 branded restaurants into new hotel rooms over the next 24 months.

It follows reports in March that Whitbread was looking to sell or convert around a third of its Beefeater and Brewers Fayre pubs.

Whitbread said the strategy would “help fund our investment in building a more tailored, integrated restaurant in our hotels as well as the construction of new hotel rooms across the estate”.

The aim is to extend around 3,500 rooms in the UK over the next five years.

Whitbread will need an investment of £500m over the next four years to fund its plans.

It warned 1,500 roles out of 37,000 are now at risk, and added: “We will seek to find alternative opportunities wherever possible through the roles created by this plan and our existing recruitment process.”

In its 2024 fiscal year results announced today, Whitbread’s pre-tax profits rose by 19% to £588m, while revenue per available room increased by 10% to £65.56.

F&B sales were up 7% versus FY23, supported by high levels of occupancy and strong breakfast sales, which were up 14% year-on-year.

Whitbread added over 2,000 new hotel rooms during the period and posted a 12% uptick in total UK accommodation sales, with strong growth across both London (+17%) and the regions (+10%).

The group also announced plans for a share buyback programme of £150m.

Dominic Paul, chief executive of Whitbread, said: “Our freehold-backed balance sheet, together with our strategy of continuing to invest, is allowing us to take advantage of the significant structural growth opportunity that exists following the decline in UK hotel supply.

“Against this backdrop, we are increasing our momentum to deliver long-term profitable growth. In addition to our strong commercial programme, we plan to optimise our F&B offer at a number of our sites to unlock up to 3,500 room extensions that will enhance the service for our hotel guests and deliver increased operational efficiencies.”

He added: “We recognise that our transition will impact some of our team members so we will be providing support throughout this process and we are committed to working hard to enable as many as possible of those affected to remain with us.”

Whitbread’s Premier Inn is the UK’s largest hotel group, with around 12% market share of total hotel room supply. Within the UK, it has over 85,000 rooms across 853 hotels, serviced by 37,000 staff.

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