Whitbread announces £500m share buyback programme
Whitbread investors are to share in the Coca-Cola deal with a £500 million share buyback programme after the sale of Costa for £3.9 billion was completed ahead of schedule, on 3rd January.
Whitbread chief executive, Alison Brittain, said in its trading update, “This has been a momentous year for Whitbread, with the sale of Costa to The Coca-Cola Company for £3.9 billion completed on 3 January 2019, much sooner than expected. We are now commencing an initial share buyback programme of up to £500 million, with further details about our plans to return a significant majority of the net cash proceeds to shareholders at our Capital Markets Day on 13 February.’’
Brittain also commented on how the company was faring both at home and abroad. She said, “The UK business achieved total accommodation sales growth of 3.5% in the third quarter. Our performance in the quarter reflects a strong Central London market and a weak regional market. We are cautious about the macro environment for the next financial year due to increased uncertainty and continuing high inflation.
“Although we are confident in our ability to create value from ongoing investment in the UK and increasing investment in international growth, in this environment we expect underlying profit before tax in FY20 to be consistent with this year.”
She continued, “Whitbread is now a focused hotel business with over 800 hotels in the UK, Germany and the Middle East, operating under the Premier Inn brand, with a committed pipeline of over 20,000 additional rooms. Premier Inn has made good progress this year, growing total sales by 2.5%, which along with strong results from our efficiency programme, means we are on track to achieve
“We continue to be excited about the opportunity in Germany and our first hotel in Frankfurt remains the number one choice for customers.
“Our second hotel in Germany will open in Hamburg in February and this year we have continued to extend the total committed pipeline in Germany, which now stands at over 6,000 rooms across 34 hotels.”