Whitbread plc

Hello and welcome to the Whitbread Q1 FY 2025 trading update. My name is Elliot and I'll be coordinating your call today. If you would like to register a question during today's event, please press star followed by one on your telephone keypad. And I'd like to hand over to Dominic Paul, Chief Executive Officer. Please go ahead.

Thank you, Elliot. Good morning, everyone. And thank you for joining the call for our Q1 trading update this morning. I'm joined by Hemant Patel, our Group CFO. We look forward to answering your questions shortly. Hopefully, you've had a chance to review the Q1 release this morning. I'll start with a brief overview for those who haven't seen it, and then we'll open up the call for Q&A. Before I touch on the first course performance, I want to start with a reminder of a number of key strategic initiatives that are going to drive our business over the next few years. We're going to continue to extend our market-leading position in the UK through our strong commercial program and accelerating growth plan. to optimise our food and beverage offer whilst adding over 3,500 rooms to our UK estate at a time when our competitors aren't able to do so. Continue our journey towards becoming the number one hotel brand in Germany and leverage our upgraded technology stack and deliver our biggest ever cost efficiency programme to allow us to become more digitally agile whilst operating a lean cost base. Together, these initiatives are set to deliver a step change in our profits, margins, and returns. In the first quarter, which ran to the 30th of May, group total sales were 1% ahead of last year, led by a strengthening performance in the UK and continued encouraging progress in Germany. As expected, trading performance improved during the quarter, and total UK accommodation sales were in line with what was a particularly strong trading period last year. This was still up 55% versus pre-pandemic, reflecting the favourable UK supply backdrop and the progress we have made over the past few years. The strength of our brand and vertically integrated operating models meant that we continued to outperform the mid-scale and economy sector, maintaining a healthy REVPAR premium of £5.62. In Germany, we delivered another strong performance, with total accommodation sales 15% ahead of last year, led by the increasing maturity of our estate and continued room growth. We're particularly pleased with our cohort of more established hotels, which continue to outperform the market, and we are making good progress towards reaching break-even on a run rate basis later this year. Whilst our normal booking patterns mean that forward visibility is limited, our forward booked position is positive and we remain confident in the full year outlook. This reflects a more encouraging performance in the UK as a result of our strong commercial programme and increased cost efficiencies, as well as our good progress in Germany. With an improved consumer outlook and significant growth potential in both the UK and Germany, supported by the structural reduction in supply and our asset-backed balance sheet, A longer-term strategic plan is set to deliver a step change in our performance. I'll now hand back to Elliot to host the Q&A. As you know, we have our AGM today, and we only have half an hour this morning, giving us only a few weeks since our last update. Could I please ask you to limit your questions to two per person? Thank you.

Thank you. If you would like to ask a question, please press star followed by one on your telephone keypad. If you would like to withdraw your question, please press star followed by two. When preparing to ask your question, please ensure your device is unmuted locally. Our first question comes from Jamie Rollo with Morgan Stanley. Your line is open. Please go ahead.