Whitbread, the FTSE 100 hotels group behind the Premier Inn brand, said trading remained ahead of expectations in the first half and it was confident in its full-year outlook as it pressed ahead with a strategic overhaul.
Adjusted profit before tax for the six months to 27 August came in at £287 million, down from £316 million a year earlier, reflecting transition costs from the group's Accelerating Growth Plan (AGP), cost inflation and continued investment in Germany.
Statutory profit before tax fell more sharply to £109 million from £287 million, after £178 million of adjusting items driven primarily by non-cash impairment charges linked to the AGP and the group's broader strategic review.
On the trading front, UK and Ireland accommodation sales rose 3% and revenue per available room (RevPAR), a standard hotel industry measure of yield, grew 2% to £70.93, outperforming the wider midscale and economy market by 2 percentage points for the fifth consecutive quarter.
Since the period end, momentum has strengthened further, with UK accommodation sales up 4.5% and RevPAR up 3.2% in the first five weeks of the second half.
Germany continued to make progress, with total accommodation sales up 19% in local currency, supported by nearly 1,800 new room openings, and the group said it remained on track to deliver a second consecutive year of profitability there.
Group statutory revenue rose 2% to £1.572 billion, with adjusted earnings before interest, tax, depreciation, amortisation and rent (EBITDAR) edging up 1% to £608 million despite significant cost headwinds.
Net debt stood at £663 million at the period end, up from £563 million a year earlier, reflecting continued AGP investment and the phasing of planned property disposals.
The board declared an unchanged interim dividend of 36.4p per share, payable on 4 December.
Chief executive Dominic Paul said the group's Five-Year Plan was on track to generate £2 billion available for shareholder returns by 2031.
He urged shareholders to vote against a resolution proposed by activist investor Corvex Management at a general meeting called for 9 November.
