UK: Costa drives first quarter growth at Whitbread
- Credit: Archant
Coffee chain Costa warmed shares in parent company Whitbread today after figures revealed another sales boost during Britain’s colder-than-normal spring.
Costa’s like-for-like revenues rose 8% in the 13 weeks to May 30 as more customers lingered in its shops due to frozen temperatures outside.
However there was no such boost for Whitbread’s restaurant chains Beefeater and Brewers Fayre, with the cold weather resulting in flat like-for-like sales despite improved trading in recent weeks.
Across the group, which includes Premier Inn hotels, Whitbread’s underlying sales were 3.1% higher as it maintained the performance that has driven a 60% rise in its share price in the past year. The FTSE 100 stock rose 3% today.
Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers, said: “Whitbread has delivered its almost customary breath of fresh air in the midst of a tepid economic backdrop.”
He added that despite tough comparatives in the run up to the Olympics last year, Premier Inn continued to maintain its leading position with sales growth of 2.7% for the first 13 weeks of the company’s new financial year.
Whitbread recently vowed to step up expansion of its Premier Inn and Costa chains in a move set to create 12,000 jobs over the next five years.
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Having created 3,000 UK jobs over the last financial year, its new targets will see it grow Premier Inn by 45% to around 75,000 rooms and double coffee chain Costa’s sales to around £2 billion.
It recently reported an 11% rise in underlying profits to £356.5 million for the year to February 28.