Costa powers Whitbread forward

14th Dec 2010 07:13

Another booming quarter for its coffee chain Costa helped Whitbread lift sales by 13.6% over the past three months, with like-for-like revenue up 6.8%, but the shares fell slightly amid signs of softness in some areas.Sales at Costa in the 13 weeks to end November rose by 31% with like-for-like sales up 11%."The positive momentum in our business gives us confidence that, despite tougher comparatives and an uncertain outlook for consumer spending, the outturn for the full year will be in line with market expectations for strong profit growth," chief executive Andy Harrison said.Hotel and restaurant sales rose by 8.2% over the last three months with like-for-like sales up 5.9%. Premier Inn like for like occupancy for the year to date increased to 80% but is expected to be around 77% for the full year, still higher than the 70.2% occupancy rate seen in the previous year. Premier Inn's like for like revenue per room growth of 9.2% (from £40.01 to £43.70), outperformed the budget sector by 4.6 percentage points, Whitbread added.Whitbread said that poor weather recently had affected trading at its restaurant business.Reports at the weekend had hinted that Whitbread might demerge its booming coffee business, but there was no mention today, Instead, Whitbread reiterated it intends to open around 300 new stores this year taking total to 1,200 in the UK and 650 internationally, with 3,000 the eventual target.While describing Whitbread's performance as strong, broker Panmure Gordon downgraded its stance on the stock to 'hold' from 'buy', pointing to the difficult start to the fourth quarter given the weather.