Why invest?
Whitbread is the UK’s largest hospitality business, employing over 30,000 people and a long-time constituent of the FTSE100. We are the number one hotel operator in the UK with a leading value F&B offering and are rapidly expanding our Premier Inn brand in Germany.
With an open and committed network of over 90k rooms in the UK, meaning you’re never far from one of our hotels. We have clear line-of-sight through organic acquisition and network optimisation to get us to at least 110k rooms in the UK.
In Germany, our network is rapidly expanding. Focusing on prime locations across the country, we have worked hard through a mixture of organic acquisitions and M&A to rapidly build an open and committed network of 14k rooms. Whilst we see potential for at least 60k rooms in the market, we are confident we can grow beyond this.
1: Includes sites in: Jersey, Ireland & The Isle of Man
Our strategic priorities
We have a compelling strategy prioritising three key areas that remain highly relevant and are positioned well to grow market share through enhanced structural opportunities. This combined with our unique business model, strong fundamentals and an appropriate capital structure will provide a platform for continued long-term growth.
Our Force for Good program underpins the decisions we make ensuring we operate responsibly and sustainably in everything we do. We’ve been recognised by both CDP and Sustainalytics for our achievements.
Read about our business model in the about us sectionGrow and innovate in the core UK markets
- Ownership and operating model is a competitive advantage
- Number one brand and winning customer proposition
- Growth through existing pipeline and optimisation
Market
share
gainsFOCUS ON OUR STRENGTHS TO GROW IN GERMANY
- Replicate historic Premier Inn UK success in Germany
- Ambition to be the market leader
- Significant headroom to grow – organic and M&A
GROWTH
Build the capability to support long-term growth
- Freehold value and ongoing efficiency programme
- Balance sheet flexibility and ability to invest
PROFIT
RECOVERY AT
ATTRACTIVE
ROCE
Our force for good program underpins the decisions we make ensuring we operate responsibly and sustainably in everything we do
Read moreOur strengths & opportunities
A structurally advantageous market combined with our strong and agile business model makes us best-placed to capitalise on the recovery opportunity and reinforce our market leading position.
- UK
- Germany
Enhanced structural opportunities
Market supply contraction accelerating PI market share gains and growth
Source: Company data and estimates.
- Both UK and German markets are highly fragmented with a high percentage of independent hotel players
- Both markets are characterised by long-term migration from independents to budget branded hotels, driven by demand weakness and structural cost pressure
- The impact of COVID-19 is expected to accelerate the decline of independents further, giving Premier Inn an even bigger opportunity to gain market share
Budget model is structurally advantaged
Budget hotel sector is higher growth and outperforms in downturns
1. Company data
- The UK budget branded sector has grown faster than the rest of the hotel market since 2009
- The German hotel market is highly fragmented with the largest operator only having c2% market share. Our aim is to become the clear no 1. budget operator in Germany.
Broad customer reach
Flexible model caters to a wide range of customer types
- Premier Inn’s customer base is driven by domestic travellers seeking short stays (1 – 2 nights) for both business and leisure
- This broad reach not only covers a wide range of customers and markets, but also makes us more resilient as we’re not reliant on one particular area of the market
- The German market is larger than the UK and also has higher levels of domestic travel for both business and leisure, making this a highly attractive market in which to replicate our successful UK business model
Strong hotel brand
Strong hotel brand in the UK
Industry leading direct distribution, only 1% of sales through OTAs
BrandIndex1
| Metric | Premier Inn | Variance 1st to 2nd | |
| Satisfaction | 41.7 | 1st | 18.7 |
| Impression | 40.8 | 1st | 11.1 |
| Value | 41.5 | 1st | 15.0 |
| Likelihood-to-recommend | 37.6 | 1st | 19.9 |
| Quality | 27.6 | 2nd* | (5.1) |
BrandIndex2
* First place is held by a four-star competitor
- Source: YouGov BrandIndex Satisfaction, Impression, Value, Recommended & Quality Scores as at 3 March 2021 based on a nationally representative 12 week moving average
- YouGov BrandIndex Quality & Value Scores as at 3 March 2021 based on a nationally representative 52 week moving average
- We have standout customer brand scores in the UK hotel market and expect customers to rely more on their most trusted brands as they seek to travel again
- As our presence grows in Germany, we are working hard to replicate the success we have in the UK and grow the Premier Inn brand. We believe this can be achieved through delivering our outstanding customer proposition
Best-in-class operations
Competitive advantage driving a winning customer proposition
Brand strength
- UK’s strongest hotel brand
- Market leading customer metrics
- First choice for more travellers
Scale advantage
- Largest UK network
- Economies of scale
- Superior network access
Direct digital distribution
- Market leading direct digital distribution model
- Low-cost customer acquisition & retention
Operational control
- All hotels operated by us
- High quality experience
- Consistent execution, no brand fees
- Tailored F&B offering
Property flexibility
- Low-cost access to capital
- Access to preferred sites at local level
- Lower rent costs
Everyday efficiency
- Efficient operating structures
- Standardised model & rooms
- Ongoing opportunity to drive efficiency further
Direct digital distribution
Cost efficient and provides ownership of the customer relationship
- We have market leading direct digital distribution in the UK with only 1% of sales going through OTAs
- Direct distribution has significantly lower customer acquisition and retention costs as we are not subject to high charges from online travel agents
- This approach enables us to own the relationship with the customer and invest in more effective direct and digital marketing
Lean and agile cost model
Right-sized cost base enables superior value for money offering
- We have a strong track record of material cost savings helped by our unique operating model where we retain control over all of our operations
- Our model also helped our rapid and decisive action during the pandemic, read more about it here on our COVID-19 page
Financial flexibility
Strong balance sheet provides offensive and defensive flexibility
We have a strong balance sheet with low leverage and access to significant levels of liquidity allowing us to continue to invest when others may be constrained
| £’m | Q4 FY21 |
|---|---|
| Cash & cash equivalents | 1256.0 |
| Undrawn RCF | 950.0 |
| Total liquidity | £2.2bn |
Freehold: Leasehold split
| Open estate | Total estate (open and commited) | |
|---|---|---|
| UK only | 61% : 39% | 55% : 45% |
| Germany only | 28% : 72% | 21% : 79% |
| Whitbread | 59% : 41% | 50% : 50% |
The strength of our balance sheet is underpinned by our freehold estate and provides us with flexibility to optimise our estate
