(qlmbusinessnews.com via telegraph.co.uk – – Thu, 18 Jan 2018) London, Uk – –
Leisure giant Whitbread has been hit by falling footfall on the high street, reporting a decline in like-for-like sales at its Costa coffee chain the day after an activist fund called for a break-up of the company.
Total revenues at the company, which also owns Premier Inn and restaurant chains including Beefeater, grew 5.6pc in the 13 weeks to November 30 after it opened new hotels and coffee shops.
But sales at UK locations open more than one year were up just 0.3pc, and down 0.1pc at Costa.
Whitbread chief executive Alison Brittain said: “Our Costa high street stores in the UK are highly profitable and generate strong returns.
“However, the well-publicised weak retail market footfall is negatively impacting our high street stores’ like-for-like performance and we expect this to continue for some time.”
UK high street footfall fell 3.5pc in December, according to figures released by the British Retail Consortium and Springboard earlier this week.
The poor performance follows reports last night that activist fund Sachem Head, which has built up a 3.4pc stake in Whitbread, had called for the company to spin off Costa.
A split has long been suggested by investors and analysts as a way to boost the respective value of both parts of the business.
Whitbread’s shares were up 2pc to £39.31 in early trade.
By Jack Torrance