Whitbread to cut 1,500 jobs as it doubles down on hotels
Hospitality group Whitbread has announced a £150m share buyback and beefed up its dividend after seeing its bottom line jump by more than a third in the year to 29 February, as it unveiled plans to cut jobs as it turns underperforming restaurants into more hotels.
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The company, which owns Premier Inn, Beefeater and a number of other names in the pub, restaurant and hotels sector, unveiled its Accelerating Growth Plan (AGP), which it said would "optimise" its food and beverage offering, leading the loss of around 1,500 jobs in the UK.
AGP will see it convert 112 underperforming restaurants into hotels while exiting 126 eateries, as part of its plan to unlock 3,500 new room extensions to reach at least 97,000 open rooms in the UK by the financial year ending February 2029. The plans will involve £500m of investment over the next four years.
Adjusted pre-tax profit totalled £561m, up 36% on the year before, bolstered by a record annual profit from Premier Inn UK and an improvement in Germany where it continues to narrow losses.
The bottom line was further helped by £50m of cost efficiencies delivered during the year and an increase in adjusted pre-tax profit margins to 21.2% from 19.6%.
Meanwhile, revenues were 13% higher at £2.96bn, driven by strong growth in the UK and continued progress in Germany.
The board lifted its final dividend by 26% to 62.9p per share, taking the total payout to 97p, up 31% on the previous year.
""We have delivered an outstanding set of results in FY24, led by the strength of our UK hotels business. Our increased levels of profitability, operating cashflow and return on capital reflect the power of our unique operating model," said chief executive Dominic Paul.