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Covid-19: Whitbread to shut hotels and suspend dividends


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Whitbread has announced that it has begun the process of temporarily closing all Premier Inn hotels amid the coronavirus outbreak.

The closures of UK sites will begin “with immediate effect”, while all its german hotels are also set to close in light of the pandemic. 

The group is now in discussions with the UK government regarding the use of its hotels housing front-line key workers as the outbreak continues. 

In its latest update, the group also announced that it will not declare a dividend this financial year.

The group also said that its financial performance for the year ended 27 February 2020 will be “in-line” with expectations, though trading in the final period has been “materially adversely impacted” by coronavirus. 

In the “rapidly changing” situation, it said it is “not possible to predict the full extent of the market down-turn” and the impact on revenues. 

It is, however, taking measures to reduce cash outflow during the period.

All discretionary P and L spending has been eliminated, including room refurbishment plans and marketing, while the group is also planning to place a “significant number” of its teams on a temporary furlough.

Non-committed development capital expenditure has also been cancelled, including refurbishments, extensions, freehold builds and acquisitions across the UK and Germany.

In a statement, the group said: “Whitbread is a strong and much-loved business that has successfully navigated numerous turbulent periods during its proud 278-year history. 

“Today, the combined strengths of its people, business model and its brands, alongside a strong balance sheet and the decisive action being taken, means Whitbread is well-placed as we face into this uncertain period.”

 

 


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