Whitbread H1 2026 Earnings Report

Whitbread EPS Results

• Actual EPS: GBX 133.70
• Consensus EPS: N/A
• Beat/Miss: N/A
• One Year Ago EPS: N/A

Whitbread Revenue Results

• Actual Revenue: N/A
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Whitbread Announcement Details

• Quarter: H1 2026
• Date: 10/16/2025
• Time: Before Market Opens
• Conference Call Date: Thursday, October 16, 2025
• Conference Call Time: 3:00AM ET

Whitbread (LON:WTB) is the owner of Premier Inn, the UK’s biggest hotel brand, with 86,000 rooms in over 850 hotels and a growing presence in Germany with 10,500 rooms in 59 hotels, offering quality accommodation at affordable prices in great locations. People are at the heart of our business. We employ over 38,000 team members in over 900 Premier Inn hotels across the UK and Germany.

Whitbread H1 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: In the UK, occupancy rose to 81% in H1 with RevPAR up 3% year-on-year in the current trading period, and forward bookings are ahead of last year.
• Positive Sentiment: In Germany, adjusted losses narrowed to £3 million in H1, and the business is on track to deliver up to £5 million of PBT this year with a medium-term target of £70 million by FY 30.
• Positive Sentiment: Group EBITDA was down just 2% on the prior year, and strong free cash flow funded £95 million of property disposals and £182 million returned to shareholders in H1, with a £250 million share buyback underway.
• Positive Sentiment: The accelerated growth plan will unlock 3,500 extension rooms and replace F&B formats, reversing last year’s one-off £20–25 million profit impact and targeting over £100 million of incremental profit by FY 30.
• Negative Sentiment: The company moderated its German PBT guidance to up to £5 million this year due to softer-than-expected market demand, and anticipates an additional £5–10 million of lease costs from sale-and-leaseback activity.

Presentation

[Dominic Paul, CEO at Whitbread]

Good morning, everyone. I'm Dominic Paul, Group CEO, and I'd like to welcome you to Whitbread's 2026 Interim Results Presentation. Today's presentation will take place by remote webcast, followed by a live Q&A session at 9:15 A.M. UK time, when Hemant Patel, our Group CFO, and I will be happy to answer your questions. Details of how to join the call can be found on the website. I'm going to start by taking you through the excellent progress we have made during the first half and provide a summary of our results. I'll then hand over to Hemant, who will take you through our results in detail. I'll then come back to cover the strategic initiatives which ladder up to our five-year plan. But first, I just want to spend a few moments on the strategic progress we are making to transform our business.

[Dominic Paul, CEO at Whitbread]

When I rejoined Whitbread nearly three years ago, it was already a fantastic business, but with the potential to go even further. Since then, we have announced our exciting growth plan, which, together with our other strategic initiatives, became our five-year plan that sets out the scale of our ambition. I'm really pleased with the progress we are making in what has been a more challenging environment. In the UK, as the overall market returned to growth in the second quarter, I'm pleased to say that we maintained our outperformance versus the market in the first half, driven by our strong guest proposition and ongoing commercial program. In Germany, we are making great progress and remain on track to deliver profitability in full year 2026. With an increasing scale and maturity, we expect to deliver GBP 70 million of profit before tax by full year 2030.

[Dominic Paul, CEO at Whitbread]

By focusing on what we can control, we continue to make excellent progress on each of the key initiatives underpinning our confidence in the medium term. As a result, our Five-Year Plan remains on track to deliver a step change in our profits, generating GBP 2 billion for shareholder returns by full year 2030. We are executing well and are on a clear path to become a much bigger and an even better business, delivering for our guests, teams, and shareholders. Having seen a return to market growth in the second quarter, UK total accommodation sales were broadly in line with last year. We made good progress in Germany despite softer market demand in the second quarter, delivering 7% accommodation sales growth, resulting in a reduced loss of GBP 3 million.

[Dominic Paul, CEO at Whitbread]

Despite inflationary pressures, our UK cost base reduced by 3%, with the impact of our Accelerating Growth Plan and increased cost efficiencies. Lower UK profit before tax meant the UK return on capital employed for the first half was 11.8%. While Group PBT was back 7%, the strength of our vertically integrated model meant that Group EBITDA was down just 2% year on year and still 41% up versus full year 2020. As a result, we generated significant free cash flow that helped fund our program of investment, as well as GBP 182 million of shareholder returns in the period. And despite low earnings, with the impact of share buybacks completed over the last 12 months, adjusted earnings per share reduced by just 2%. Moving now to the outlook for full year 2026.

[Dominic Paul, CEO at Whitbread]

While forward visibility remains limited, and despite some uncertainty around the forthcoming UK budget, I am pleased with the progress we are making across each of our three strategic pillars and remain confident in the full year outlook. First, in the UK, as you will have seen, the positive momentum has continued into the current trading period, and our forward booked position is ahead of last year. We've remained on track to open 1,000 to 1,200 new rooms this year, and we're making excellent progress with our Accelerating Growth Plan, having now opened the first of our new extension rooms. We are on track to fully reverse the impact on full year 2025 profits. Second, in Germany, demand has stepped up in recent weeks, and we are delivering a more positive trading performance.

[Dominic Paul, CEO at Whitbread]

We have significantly grown our pipeline with the agreement to acquire eight new hotels in prime city locations and remain on track to open 400 new rooms by the end of this year. And we are on course to deliver profitability in Germany this year, albeit we are moderating our guidance slightly and now expect to deliver adjusted PBT of up to GBP 5 million this year, reflecting softer than expected market demand in the second quarter. And third, we will continue to drive long-term growth. Having made great progress in the year to date, we will recycle GBP 250-300 million worth of property this year to help fund our network expansion and Accelerating Growth Plan. We now expect to deliver GBP 65-70 million of efficiencies this year, up from GBP 60 million guided previously, partially mitigating high levels of inflation.

[Dominic Paul, CEO at Whitbread]

We are on track to complete our previously announced GBP 250 million share buyback by the time of our full year 2026 results. The excellent progress that we are making on our initiatives means that we remain confident in delivering a step change in profitability and significant returns for shareholders. Our Accelerating Growth Plan will boost UK margins and returns by optimizing our food and beverage offering at a number of sites and unlock 3,500 extension rooms. We will also open at least 8,000 new high-returning hotel rooms, reaching 98,000 rooms across the UK and Ireland. Together, these two elements will deliver over GBP 220 million of incremental profit by full year 2030. In Germany, we aim to have 20,000 rooms open by the end of full year 2030.

[Dominic Paul, CEO at Whitbread]

With greater scale and brand maturity, we will remain on track to reach GBP 70 million profit by full year 2030 and uplift of GBP 80 million versus full year 2025, and as a budget hotel brand, we remain focused on managing our costs and will deliver GBP 250 million worth of savings by full year 2030. Our commercial program is expected to drive positive like-for-like sales momentum in the UK, and together with our efficiencies, our assumption is that we will be able to offset cost inflation over the life of the plan. This plan is fully funded, and we will keep average net CapEx of GBP 500 million, which is net of proceeds from property-related transactions. We have made great progress, having completed a number of sale and leasebacks at attractive yields in the year to date.

[Dominic Paul, CEO at Whitbread]

We are pleased with the updated valuation of our estate and are confident that we can recycle at least GBP 1 billion worth of property over the life of the plan. I will now hand over to Hemant, who will take you through our performance in more detail.

[Hemant Patel, CFO at Whitbread]

Thanks, Dominic, and good morning, everyone. I'll start with a summary of the group's performance before covering the UK and Germany in a bit more detail. I'll then provide an overview of our FY26 outlook, current trading, and updates to our guidance, before a reminder of our capital allocation framework and some details of our updated property valuation. Our robust trading performance in the UK and good progress in Germany were offset by reduced food and beverage revenues owing to our Accelerating Growth Plan, resulting in overall revenues slightly behind last year. Higher than expected gross inflation was mitigated by excellent progress on cost savings and reductions in our cost base due to the Accelerating Growth Plan. As a result, operating costs fell by 2%, but slightly lower revenues meant that our Adjusted EBITDA was also down 2% to GBP 0.6 billion.

[Hemant Patel, CFO at Whitbread]

Having returned GBP 182 million to shareholders over the past six months, lower net interest receivable meant that adjusted profit before tax was GBP 316 million. Adjusting items of GBP 28 million, the majority of which related to our Accelerating Growth Plan, meant that statutory profit before tax was GBP 287 million. Our vertically integrated model continues to generate significant operating cash flow, and we were able to build on this with GBP 95 million in property disposals, helping to fund our investments in high-returning growth opportunities. We have a strong balance sheet with lease-adjusted leverage of 3.2 times, which is within our investment grade threshold of three and a half times. I'll now run through the guidance behind this performance, starting with the UK. UK accommodation sales were aligned with the first half of last year.

[Hemant Patel, CFO at Whitbread]

This, with the expected reduction in food and beverage revenues as a result of our Accelerating Growth Plan, meant that total UK revenues were 3% behind last year. Although there was higher than expected cost inflation, we delivered an increased level of efficiencies, which, together with the impact of our Accelerating Growth Plan, meant that UK operating costs fell by 3%. Taking all of these movements together, UK adjusted profit before tax reduced by 7% to GBP 331 million. Our occupancy level stepped up in the second quarter as we saw a return to market growth, supported by stronger demand over the summer months, delivering 81% in the first half, which, although lower than last year, is still ahead of pre-pandemic levels. With the benefits of our commercial initiatives and trading expertise, average room rates strengthened by 2% to GBP 86.

[Hemant Patel, CFO at Whitbread]

While RevPAR was back 1%, with the impact of our continued network growth, total accommodation sales were flat at GBP 1.1 billion, over 50% higher than pre-pandemic. While our level of outperformance can vary depending on a number of factors, including supply changes, competitive force, and demand levels, we sustained our market outperformance in the first half. Through our brand strength, trading expertise, and commercial initiatives, we outperformed the market on both RevPAR and accommodation sales growth, and it continues to command a healthy RevPAR premium that increased to just over GBP 6. In the current trading period, we're analyzing against what was a strong performance last year. However, we've maintained a healthy RevPAR premium to the market of just over GBP 5.50. Now on to Germany. We're pleased with our progress in Germany, despite softer than expected market demand in the second quarter.

[Hemant Patel, CFO at Whitbread]

Revenues were up 9%, driven by the increasing maturity of our estate, further improvements to our trading strategies, broadening our distribution, and increasing food and beverage sales. Operating costs in the period increased to GBP 88 million, reflecting our network expansion and cost inflation. However, with strong revenue growth, our EBITDA increased by 23% to GBP 37 million, and adjusted losses before tax reduced significantly to GBP 3 million. Our cohort of more established hotels is continuing to mature and is a key driver of our overall performance. On a rolling 12-month basis, profit before central overheads increased to GBP 17 million in the period, up from GBP 10 million a year ago, and the cohort is on track to reach its targeted double-digit return. We're making excellent progress with continued outperformance versus the rest of the German mid-scale and economy market.

[Hemant Patel, CFO at Whitbread]

As you can see, both our more established cohort and our network as a whole are outperforming the market in terms of RevPAR growth, despite softer than expected market demand in the second quarter. RevPAR and our cohort and more established hotels grew by 3% in local currency ahead of our total estate, reinforcing the point that it is not yet mature and giving us real confidence that it can and will grow further. Turning now to group cash flow. The strength of our vertically integrated model meant that we delivered adjusted operating cash flow of GBP 406 million, helping to fund both our ongoing program of investment in future growth and shareholder returns.

[Hemant Patel, CFO at Whitbread]

We continue to invest in high-returning growth opportunities, including our Accelerating Growth Plan and network expansion in both the UK and Germany, with the result of gross CapEx then was higher than last year at GBP 328 million. As previously announced, we will recycle GBP 1 billion of property over the life of our five-year plan, with GBP 250-GBP 300 million of property proceeds expected in FY26. We made great progress towards this with GBP 95 million of proceeds from property disposals, resulting in net CapEx of GBP 233 million. The net result was a total cash flow before shareholder returns of GBP 102 million. Having returned just over GBP 180 million to shareholders via dividends and share buybacks, we maintain a strong balance sheet with a net debt position of GBP 563 million and a lease-adjusted leverage of 3.2 times, which is below the investment grade threshold of three and a half times.

[Hemant Patel, CFO at Whitbread]

Now on to current trading and updates to our FY26 guidance. In the UK, positive trading momentum continued, and both total accommodation sales and RevPAR were up 3% versus last year. Our forward booked position is ahead of last year, and with continued impacts of our commercial initiatives, we remain confident in maintaining a healthy RevPAR premium versus the market. F&B sales were down in line with our expectations, reflecting the impact of our Accelerating Growth Plan. In Germany, we've seen marked recovery in more recent weeks after what was a soft start to September, with total accommodation sales up 9% versus last year. RevPAR for the total estate was 3% ahead of last year at EUR 82, and RevPAR for the more established cohort was 8% ahead of last year at EUR 95.

[Hemant Patel, CFO at Whitbread]

With a positive forward book position supported by a strong events calendar, we're confident that we can drive further RevPAR growth. Reflecting the group performance of the year to date, we've made some modest changes to our FY26 guidance as follows. Higher than expected cost inflation in the UK will be partially mitigated through accelerated efficiencies of GBP 65-GBP 70 million at FY26, up from GBP 60 million. As a result, we still expect net inflation to be within our previously guided 2%-3% range. In Germany, we're making good progress and remain on track to deliver profitability this financial year, albeit we're moderating our PBT guidance slightly and now expect up to GBP 5 million of PBT this year from GBP 5-GBP 10 million previously, due to softer than expected market demand in Q2.

[Hemant Patel, CFO at Whitbread]

Finally, there'll be an additional GBP 5-10 million of lease costs as a result of the progress we're making on sale and leasebacks. Our capital allocation framework is unchanged. Our disciplined approach is focused on delivering sustainable, attractive returns and seeks to strike an appropriate balance between investing in high-returning growth opportunities and returning excess capital to shareholders. As a reminder, there are four priorities in our framework. First, maintaining investment grade credit rating is a source of strategic advantage for us, and we will continue to keep lease-adjusted leverage below our threshold of three and a half times. Second, investing in high-returning growth opportunities, such as the Accelerating Growth Plan, and using proceeds from property-related disposals to keep average net CapEx to a maximum of GBP 500 million per annum, whilst the life of our five-year plan. Third, continuing to grow dividends in line with earnings.

[Hemant Patel, CFO at Whitbread]

Lastly, returning excess capital to shareholders. As well as keeping the interim dividend per share the same as last year, we're on track to complete our previously announced GBP 250 million share buyback by the time of our FY26 results, and we remain on course to return GBP 2 billion to shareholders via share buybacks and dividends over the life of our five-year plan. Finally, an update on our recent property valuation. Since it was last valued in 2018, we're pleased that the value of our freehold and long leasehold property has increased to between GBP 5.5 and GBP 6.4 billion, which represents an uplift of circa GBP 0.5 billion. This is based on individual sale and leaseback transaction values in the wider market.

[Hemant Patel, CFO at Whitbread]

The key assumptions are a net initial yield range of 5.5%-6.5%, average rent cover of 2.0 times, and it includes GBP 760 million for non-trading assets and those still under construction. It's also worth highlighting that since the last property valuation in 2018, we've realized over GBP 400 million of property-related disposal proceeds. As previously announced, we'll recycle GBP 1 billion of property over the life of our Five-Year Plan and are making great progress. We've completed the sale and leaseback of eight properties for GBP 99 million of attractive yields. This includes our Clapham hotel in London, for which we realized GBP 19 million in cash and profits on disposals of nearly GBP 4 million. Having received GBP 120 million of property proceeds in the year to date, including restaurant disposals, we're on track to realize between GBP 250 and GBP 300 million in FY26.

[Hemant Patel, CFO at Whitbread]

I'll now hand back to Dominic to talk through our strategic priorities in more detail. Thank you, Hemant. I'll now take you through the progress we've made against our key initiatives and our future plans. Turning first to our strategy and progress in the UK Our Accelerating Growth Plan is our biggest ever development program, increasing the performance of over 200 of our UK sites. The transformation of our food and beverage offering at these locations will result in us becoming a much bigger and more profitable business, while delivering an even better service for our hotel guests. Drawing upon our significant in-house property expertise, we are making excellent progress on unlocking 3,500 high-returning extension rooms in areas where we know we have excess demand. And I'm pleased to say that the first of our extension rooms are now open.

[Hemant Patel, CFO at Whitbread]

On the right-hand side of the slide, you can see that we've moved quickly over the past 18 months, and as of the half year, we have 80% of all schemes in planning, with 60% of these already approved. We have completed or are in progress at over 20% of sites, with further progress against all of these measures expected by the end of this financial year. The other element is optimizing our food and beverage offering at these sites, replacing the previous branded restaurant with a more tailored and efficient integrated format for our hotel guests. Having already sold just over 40 sites, we are on track to exit the remaining effective branded restaurants by the end of full year 2026 as planned, and have already opened just over 50 new integrated restaurants, which are driving an increase in commercial performance.

[Hemant Patel, CFO at Whitbread]

By the end of this year, we will have 500 to 700 extension rooms open, and as previously guided, we are on track to fully reverse the one-off impact for last year's profit of between GBP 20 to GBP 25 million. Once complete, the plan will deliver incremental profit versus full year 2025 of at least GBP 100 million, increasing our UK margins and returns. Since the pandemic, UK hotel supply has declined, driven by a shift in demand from non-branded to branded hotels and a reduction in the number of independents. Our market analysis, which is based on conservative assumptions, shows that we don't expect hotel supply to recover to 2019 levels until at least 2027. Our committed and future pipeline of both Premier Inn and Hub rooms, alongside 3,500 extension rooms unlocked through our Accelerating Growth Plan, supports our target of reaching at least 98,000 rooms by full year 2030.

[Hemant Patel, CFO at Whitbread]

We are well placed to capture further profitable share of the UK hotel market and drive returns higher. As we progress towards our long-term potential of up to 125,000 rooms across the UK and Ireland, the pace at which we open new rooms will be determined by the level of returns that we can generate. With nearly 30% of our committed pipeline driven by the expansion of Hub, I want to spend a few moments talking about why we are excited about the brand momentum and longer-term potential. There are a number of differences between Hub and our main Premier Inn brand. Hub allows us to target a distinct part of the market, attracting both business and leisure guests who value prime city locations. The rooms feature a sleek, modern design with integrated technology.

[Hemant Patel, CFO at Whitbread]

While smaller than a typical Premier Inn room, they offer everything that our guests need for a great stay. And the customer journey is more digitally led, catering to tech-savvy guests. While there is a food and beverage offer, this is a more tailored offering with a focus on the bar experience. And why does it work? Well, we've been able to drive high occupancy levels at a great price point for our guests. And with a lean operating model, this is resulting in strong economics. With a higher density of rooms per square foot than a traditional Premier Inn, we can drive higher profit per room and still meet our returns thresholds, even in relatively high-cost locations. While pleased with our strong performance and high guest scores, we are further optimizing our offer.

[Hemant Patel, CFO at Whitbread]

With 5,000 rooms and our open and committed pipeline, we feel that the brand has huge potential. We're excited about where it can go from here. Turning now to our commercial program, Premier Inn remains the UK's number one hotel brand with over 90% brand awareness. However, we are not complacent and have continued to invest in our brand with several successful campaigns in the period. We are also optimizing our digital marketing activity across multiple channels, increasing the impact of our campaign and reducing our cost of acquisition. We are broadening our addressable customer base and doing so profitably. Our business-to-business proposition continues to perform well with good growth in Business Booker through improved account management for our customers. To make it even easier to book with us, we will launch Premier Inn Business this year, combining our Business Booker and Business Account into one single platform.

[Hemant Patel, CFO at Whitbread]

We are also continuing to optimize our relationships with travel management companies, which is driving sales growth through this important channel. Our use of inbound-only online travel agents is going well and is proving to be a helpful addition in driving incremental international demand. As we've highlighted already in this presentation, we have continued to outperform the wider market in the first half, underpinned by the success of our commercial program. Strong revenue management remains central to our approach and a key differentiator versus our competitors. Our proprietary automated trading engine enables us to refine and optimize our pricing for any given volume of demand so that we can maximize revenues and returns. Our ancillary options are performing well and helping to drive incremental revenue.

[Hemant Patel, CFO at Whitbread]

We'll also continue to optimize our event traiding strategies and have included an example which shows our significant outperformance versus the market on both occupancy and RevPAR for one of the recent Oasis concerts at Wembley, and we're further enhancing the digital experience and making good progress towards the app becoming central to how guests book and stay with us. We've seen improvements in satisfaction, channel share, and revenues driven by updates to the customer journey, such as the options to check in online, providing a more seamless arrival experience. The majority of our guests book directly with us, meaning we have access to a large and growing customer database. By leveraging our data, we are seeing an increase in guest engagement and are enhancing our promotional capabilities, with one recent email campaign alone delivering GBP 3 million in incremental revenue.

[Hemant Patel, CFO at Whitbread]

All of these initiatives are helping us drive positive like-for-like sales momentum. With more initiatives planned, we have the potential to increase our commercial performance even further. Our vertically integrated model underpins our position as the UK's number one hotel brand, driven by our reputation for high quality and great value. We are progressing with the rollout of our latest standard room format, ID5, which is delivering improved guest scores. We are continuing to add more Premier Plus and twin rooms, which deliver a RevPAR premium compared to a standard room in the same hotel. In Food and Beverage, our integrated ground floor concepts are performing well. And for those branded restaurants unaffected by our Accelerating Growth Plan, we have implemented a range of commercial initiatives to help drive positive sales momentum and increase profitability.

[Hemant Patel, CFO at Whitbread]

Finally, we remain committed to supporting our teams, maintaining high levels of engagement and employee satisfaction, which in turn helps to drive great guest scores. The UK inflation environment has been challenging over the past few years, particularly with impact from increases in National Living Wage and National Insurance contributions. We have a strong track record of responding to these headwinds and, over time, mitigate their impact through careful management of our cost base and the delivery of significant efficiencies. In the first half, we delivered GBP 43 million and are now accelerating our expected savings between GBP 65 million and GBP 70 million this year. We remain on track for a total of GBP 250 million in efficiencies across the life of the plan. The program reflects multiple initiatives across all areas of our business, which, when taken together, add up to a lot.

[Hemant Patel, CFO at Whitbread]

You've heard us talk about robot vacuums before, but they are making a real difference for our housekeepers and reducing our costs across our estate and will be operational at the vast majority of our sites by the end of the year. I'm also pleased to say that in the first half, we have transformed our food and beverage distribution, moving to a new supplier, adopting a more tailored streamline model that is already driving significant savings and operational benefits. Now let's move on to Germany. Germany is a significant growth opportunity. The investment case is highly attractive for the large fragmented market and no clear market leader, and we are on course to replicate our UK success. We've grown rapidly over the last few years and are building a meaningful presence.

[Hemant Patel, CFO at Whitbread]

With our latest agreement to acquire 1,500 rooms, together with our growing committed pipeline, we will have just over 20,000 rooms, close to double the number of rooms we have opened today. This is not the end goal. We're determined to fulfill our ambition to become the number one hotel brand in Germany. As we've built our presence in Germany, we've refined our property strategy. And having learned a lot over the past few years, we've now cracked the code using optimal location planning to get the best sites and make better decisions about how we convert new sites to the Premier Inn brand, drive efficiencies, accelerate maturity, and generate higher returns. Supporting our longer-term growth ambitions, we have agreed the acquisition of 1,500 new rooms, which is eight hotels, located in great locations in key cities, with completion expected in the spring of 2026.

[Hemant Patel, CFO at Whitbread]

To bring this to life, we have shown on the right-hand side what our Hamburg portfolio will look like with this latest acquisition. With six hotels already open, three in the committed pipeline, and two more added through this deal, we're on track to reach 11 open hotels in Hamburg. Strong performance from our existing Hamburg estate reinforces confidence in our longer-term plans. We will soon have circa 2,000 rooms in one of Germany's largest cities, with the potential to grow even further, and as in the UK, we are always looking to improve our commercial strategy, drawing upon our growing pool of data to drive our performance. Throughout the first half of this year, we continue to drive RevPAR growth ahead of the market, even in what was a softer than expected second quarter.

[Hemant Patel, CFO at Whitbread]

We continue to refine our trading strategies, with a particular focus on event nights, given their significance in Germany. We have seen a year-on-year improvement in our performance versus the market on these nights, with our more established cohort now delivering RevPAR ahead of the market and our total estate performing broadly in line. With confidence that this will improve as our estate continues to mature. Now, while the market faced a tough second quarter, we feel really good about the progress we're making in Germany. As I've just mentioned, we are optimizing our trading strategies. Having expanded our distribution channels to include online travel agents and third parties, we are generating incremental demand, which is contributing to further RevPAR growth, and our product is landing extremely well with guests, resulting in high guest scores and contributing to increasing brand maturity. Our five-year plan remains on track.

[Hemant Patel, CFO at Whitbread]

With our growing estate and progressive maturity, we expect to deliver adjusted profits of GBP 70 million by full year 2030. In the same year, we also expect to reach double-digit returns on our current open portfolio of 11,000 rooms. As our estate and brand continue to mature, we will see a further increase to profits, margins, and returns beyond full year 2030. And now moving on to the third bit of our strategy, enabling long-term growth. Hemant has already updated you on our latest property valuation and progress on our planned recycling of capital. I want to now remind you of the commercial and financial benefits of our flexible property approach.

[Hemant Patel, CFO at Whitbread]

We are broadly agnostic between freehold and leasehold as long as it meets our internal returns threshold, meaning we can maximize our chances of securing the best sites in the best locations while minimizing the risk of cannibalization so that we can drive strong returns. Operational flexibility means we can optimize returns from a site so that once mature, we can recycle the capital and reinvest in future growth. We can realize significant development profits through disposals, buy-sell, and leasebacks, and a property bank balance sheet supports our strong financial covenant, helping to secure more favorable terms with landlords and financing terms with lenders. Our property value creation cycle is summarized here. Our already strong covenant means we can secure high-quality sites to generate excellent returns, which in turn attract outside funding and offer us a chance to recycle capital, and so the cycle continues.

[Hemant Patel, CFO at Whitbread]

As a reminder, we segment our estate into five distinct groups shown here on the right-hand side of the slide. As a site moves through each stage, we look to recycle the capital to drive higher returns. With 20%-30% of our hotels now having strong yield potential, we are planning to recycle some of this capital into new, higher-return opportunities, such as our Accelerating Growth Plan. Our Force for Good program holds us accountable for delivering meaningful change across our three key pillars of opportunity, community, and responsibility. It is embedded across all areas of our business strategy, and we're making strong progress against our targets. Key highlights include the expansion of our Thrive program, including the launch of our latest Mini Premier Inn based in Lincoln this week, that trains and supports young people with special educational needs as they seek to enter the workplace.

[Hemant Patel, CFO at Whitbread]

Continuing our work with our charity partners, including raising over GBP 27 million to the Great Ormond Street Hospital, we're committed to raising a further GBP 20 million with a new appeal that will fund the development of a new Children's Cancer Center. And our focus on managing our environmental footprint means that we have the most low-carbon hotel rooms in the UK and Ireland, with over 2,000 open by the end of this financial year. We also remain on track to deliver a 50% reduction in food waste by 2030. So I'm going to end with a brief summary. As I said at the beginning of the presentation, I'm really pleased with the pace at which we are executing, and we are on track to deliver a step change in our profits, margins, and returns.

[Hemant Patel, CFO at Whitbread]

In the UK, the return to market growth and positive trading momentum mean we are confident in the full year outlook. In Germany, we are making great progress and are on track to deliver profitability in full year 2026. With increasing scale and maturity, we will remain on course to the GBP 70 million of profit before tax by full year 2030, with further growth potential thereafter. As I set out today, we remain focused on what we can control and are executing against each of the key initiatives underpinning our five-year plan that is set to deliver a step change in our profits, generating GBP 2 billion of shareholder returns by full year 2030. Thank you for joining us this morning. Hemant and I will host a Q&A session starting at 9:15 A.M. UK time, and we look forward to taking your questions then.

[Hemant Patel, CFO at Whitbread]

You'll be able to find the details of how to join the call on our website.

Participants

Executives

• Dominic Paul, CEO
• Hemant Patel, CFO