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Premier Inn feels the pinch

Whitbread, owner of Premier Inn, has posted a 9% rise in pre-tax profits but warned the budget hotel chain is feeling the impact of the downturn.
The group reported “good progress” in the year despite “increasingly difficult economic conditions”.
Group pre-tax profits rose to £229.9m in the 12 months to February 26, compared with £210.3m the previous year, and ahead of analyst forecasts of £221m.
In the final quarter Premier Inn had suffered reduced occupancy rates, which pushed group like-for-like sales into the red from 6 percent head for the year.
The group said like-for-like revenues per available room at Premier Inn chain were up 2.8%.
Anthony Habgood, chairman of Whitbread, said the chain’s value offering would help see it through the difficult economic climate.
“2008/09 was a year of good progress and, against a backdrop of increasingly difficult economic conditions, we delivered an industry leading performance. We are focused on managing Whitbread prudently and tightly in the face of the challenges ahead.”
In December Whitbread said it would cut expansion plans this year to around half £170m. The group said was on track to meet its cost efficiency plan, with a £7m saving last year. It plans to cut £25m from the business by 2010/11.