UK listed hotel group Whitbread is looking forward to a stronger winter period, after reporting a solid first half performance during its current financial year.

The group reported accommodation sales up 3% year on year at its UK and Ireland hotels, with revpar increasing for five quarters in a row. CEO Dominic Paul reported: “Our commercial programme and technology-led enhancements are contributing to positive like-for-like sales momentum that, together with the delivery of material cost efficiencies, is helping to mitigate the impact of cost inflation.”

Building in Two Key European Markets

In the UK, the Premier Inn hotel brand is an established market leader, while the group is also growing fast in a second major European market, Germany. There, accommodation sales grew by 18% year on year, as the company rolled out new hotels and added close to 1,800 rooms to the portfolio in the six month period. “We remain on course to deliver a second year of profitability in FY27 and thereafter accelerate our financial performance,” added Paul. The company recently bought two Future Inn hotels, in Bristol and Plymouth, to convert to new Premier Inn sites.

Many Premier Inn sites in the UK are undergoing significant changes, as the group closes down its legacy restaurants, many alongside its provincial hotels. With hotel guests changing the way they eat, such as many now choosing to use home delivery services, the group found its restaurant trade reducing.

While some restaurants have been sold to new operators, many have been refitted to provide extra hotel rooms. Premier Inn still offers guests a breakfast, via a new, smaller cafe in the hotels, but has given up on lunch and evening meal options. The company is on track to deliver the transformation in the coming months.

The German pipeline is on track to continue growing the presence of Premier Inn in the country. Before the end of 2026, the group will be opening hotels in Osnabruck, Eschborn and Konstanz.

Into 2027, more openings will deepen the breadth of accommodation offered in major German cities, with second, third and even fifth hotels opening in the larger cities. These will include Premier Inn Mannheim City Quadratestadt, Premier Inn Berlin City Spittelmarkt and hotels in Kassel and Magdeburg. A second hotel in Osnabruck, and two more properties in Berlin are also under construction.

Selling Down Hotel Assets

The company works alongside other investors, as well as building its own hotels. In Dublin, Whitbread has just put its new Clery’s Quarter hotel up for sale, seeking EUR66.6 million for the asset. In London, it is investing in building a new Hub by Premier Inn, which will have 693 rooms, the largest hotel in the portfolio to date.

The group continues to face pressure from activist investors. Corvex, a US investment group, has built up a shareholding in Whitbread and is demanding a seat on the company board. It believes the group should pursue a more asset light approach, holding less of the group’s own hotels as investment properties.