Premier Inn-owner Whitbread (WTB.L) reported a 1 billion pound ($1.39 billion) annual loss on Tuesday but said it expects a significant bounce in staycation demand this summer as COVID-19 curbs in Britain are relaxed.
Whitbread, which also owns the Beefeater and Bar + Block chains, said revenue for the year to March slumped by nearly three quarters, sending its shares down as much as 3.4% to 3,294 pence.
Britain’s hospitality industry has suffered during the pandemic, with travel and entertainment spending severely restricted by measures to stop the spread of the virus.
The country’s latest lockdown is still being eased in stages, with hotels and cinemas not set to open until May 17 at the earliest.
Britain’s COVID-19 vaccination programme, under which more than half of Britons so far have been given at least one shot, would support the return of leisure guests, Chief Executive Alison Brittain said.
“We will definitely be hiring in the summer for seasonal work for coastal destinations that are going to be full,” she told journalists. Coastal and other tourist locations make up about 15% of Whitbread’s hotels.
“We have got very strong bookings into … anything with a view, frankly.”
Brittain also said the company expects to add about 4,000 to 5,000 new rooms in the United Kingdom and Germany over the next year.
“Whitbread needs its hotels to reach 55% occupancy to break even and although management is expecting staycations to ramp up demand in the UK, it may not be enough to push the group over the line,” Hargreaves Lansdown’s Laura Hoy said in a note.
Whitbread, which has the bulk of its business in Britain, said over 92% of its hotels in the country are now open. Occupancy levels in February were at 29% across all sites.
Its 2020 adjusted pretax loss of 635.1 million pounds was its first such annual loss since at least 2002, Refinitiv Eikon data showed. Analysts on average were expecting a loss of 688 million pounds.
Statutory loss stood at 1.01 billion pounds ($1.40 billion), while sales of 589.4 million pounds missed expectations.
($1 = 0.7201 pounds)