Tuesday preview: Whitbread's H1 sales tipped to top one billion pounds

22nd Oct 2012 16:02

Costa and Premier Inn owner Whitbread is scheduled to release its interim results on Tuesday morning, in which its first-half sales are expected to top the one billion mark.Whitbread said in a trading update last month that sales for the 24 weeks to August 16th were up 14.3%, up 4.3% on a like-for-like basis.Investec said: "we assume this applies to the full H1, equating to group revenue of £1.02bn (Premier Inn +13% to £443m, Restaurants +6% to £263m, Costa +25% to £314m)." At the group level, this would represent revenue growth of 14.4% on the £973.5m reported for the first half last year.Investec is forecasting group earnings before interest and tax (EBIT) of £205.8m, up 11% year-on-year, and a half-year pre-tax profit of £195.0m, up 11.5%.The broker maintained its 'sell' rating on the stock on Monday ahead of the results.Analyst James Hollins said that the shares are now pricing in a potential re-rating, "leaving negligible upside risk for shareholders, while facing downside risk from a company with, in our view, an unachievable and/or low returns international hotels strategy, with sub-7% free cash flow and sub-3% dividend yields."Meanwhile, as Panmure Gordon pointed out in a research note last week, while the company reported a better-than-expected second quarter, each division benefitted from 'one-offs' that boost revenue growth."At the last update, the group reported that trading was variable month by month and we expect this to have continued," the broker said.INTERIMS B.P. Marsh & Partners, C&C Group, LiDCO Group, Whitbread INTERNATIONAL ECONOMIC ANNOUNCEMENTS Consumer Confidence Indicator (EU) (10:00) Q3 ARM Holdings, CSR, Norsk Hydro ASA, Virgin Media Inc. FINALS Avacta Group IMSS Premier Foods AGMS Arcontech Group, MobileWave Group , Murray Income Trust UK ECONOMIC ANNOUNCEMENTS BBA Mortgage Lending Figures (09:30) FINAL DIVIDEND PAYMENT DATE Anite, IG Group Holdings, Mattioli Woods Q1 Oil & Gas Development Company Ltd GDR (Reg S)