Fri 26th May 2023 - Sky News: Whitbread explores sale of Beefeater and Brewers Fayre brands Sky News – Whitbread explores sale of Beefeater and Brewers Fayre brands: Whitbread is laying the groundwork for a sale of part of its £700m pub and restaurant arm, including its Beefeater and Brewers Fayre brands. It is understood to have hired advisers to explore options for the division, amid concerns that poor food and drink sales are weighing on the wider business, reports Sky News. Sources said discussions are at a preliminary stage and may not result in the business being offloaded, and insisted only a “small part” of Whitbread’s food and drink operations was under consideration. It follows a warning in Whitbread’s recently published annual report of “the increasing divergence of performance of the hotel business and the food and beverage business”. This could have a detrimental effect on the premium charged by Premier Inn for rooms compared with its rivals, Whitbread said. Whitbread’s accommodation group sales grew by 27% in the year to March compared with a year earlier, while food and beverage sales by 4%. “The expected bounce back following the removal of trading restrictions last year has not materialised fully,” the company said in its annual report. Whitbread’s advisers are understood to have begun contacting potentially interested parties, asking them to sign non-disclosure agreements ahead of a formal sales process. Bankers are understood to have championed the chain’s freehold properties, against which bank financing could be secured. The sales process is at an early stage and Whitbread’s advisers have not guided parties on the valuation of the business, sources said. Last month, Whitbread reported that its F&B sales in the 52 weeks to 2 March 2023 were 40% ahead of FY22 but 4% behind pre-pandemic levels, with increased spend per head outweighed by a decline in customer volumes. In current trading – seven weeks to 20 April 2023 – it said UK F&B sales were 10% ahead of FY23, reflecting “softer trading in the base year and the benefit of a number of commercial initiatives”. The Premier Inn owner reported total statutory revenue for the year increased by 27% versus FY20 to £2.625bn and adjusted operating profit increased to £544m, up 12% versus FY20. It said total UK accommodation sales were up 17% versus FY23, with RevPAR £6.08 ahead of the M&E market in the most recent seven weeks. Whitbread features in Propel’s Turnover & Profits Blue Book. Its turnover of £1,703,000,000 in the year to 4 March 2022 is the fourth highest in the database. Its pre-tax profit of £58,000,000 is the ninth highest in the database. The Blue Book ranks companies by turnover, profit and profit conversion, listing directors’ earnings for the past five years. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £995 plus VAT – whether they are an operator or a supplier. The single subscription rate is £495 plus VAT for operators and £595 plus VAT for suppliers. Email jo.charity@propelinfo.com to upgrade your subscription.