Executives at Whitbread PLC, parent company of the Premier Inn brand, said that in its main market, the United Kingdom, more than 92% of its hotels are open as the hotel industry gears up to welcoming all guests on May 17.

On a call with analysts to present the company's full-year 2021 performance results, CEO Alison Brittain said Whitbread expects strong pent-up travel demand this summer, amid relaxed COVID-19 restrictions in the U.K.

Additional hope comes from the government allowing limited attendance at sports and cultural events as of April 24.

Whitbread reported a year-over-year decline in revenue of 71.4% to 589.4 million pounds sterling, or $819 million, accounting for losses not just in accommodations but also from its on-site restaurant brands. Adjusted earnings before interest, tax, depreciation and amortization fell 125.9%.

Brittain said that Whitbread’s guidance is that every 1% change in total sales has a 16.5 million pounds sterling impact on profit before tax, but that this has improved from 18 million pounds sterling due to “increased flexibility in the cost base.”

The United Kingdom, the company's main market by far, has had three lockdowns since the official declaration of the pandemic.

Brittain said Premier Inn had competed very well in its midscale and economy segment after hotels were allowed to reopen in August 2020 — before another lockdown came into effect at the end of the year.

“Despite these [pandemic] challenges, the advantages of our unique operating model … along with the strength of our balance sheet and our brand have enabled us to weather the severe financial impact of the pandemic and materially outperform the U.K. hotel market to end with strong market-share gains,” she said.

“Our exposure to the faster-recovering budget sector, our resilient customer mix and the enhanced structural opportunities that the COVID crisis has created positions us well to continue this outperformance,” Brittain added.

Revenue per available room in the U.K. fell approximately 71% to 13.57 pounds sterling for the full year, compared to the previous financial year, while in Germany that decline was 78% to 9.02 pounds sterling for the same period.

“In line with government guidance, our hotels were cash-flow positive when leisure travel was permitted in the summer [2020] and our occupancy was 55% or above,” said Nicholas Cadbury, Whitbread's group finance director.

Whitbread continues to open hotels, with the latest being the April 16 debut of the 110-room Hub by Premier Inn London Soho.

The company is pushing to open more hotels under its second brand, Hub. The brand has 11 hotels in London with a combined room total in excess of 2,000, and an additional five hotels in the planning stages. Outside of London, there is one additional property in Edinburgh.

A second Hub property is set to open later this year in the Shoreditch area of London, and one of the pipeline assets is the 220-room Hub by Premier Inn at Snow Hill in a former City of London police station.

Premier Inn has more than 800 hotels and 78,000 rooms in the U.K. and a growing portfolio in its second market, Germany, where it has an open and committed pipeline of more than 12,000 rooms in 68 properties. In 2020, despite coronavirus, Premier Inn’s German portfolio increased from six to 30 hotels.

Brittain said Premier Inn's pipeline in Germany has a goal to reach 60,000 rooms. She said hotels in that market have had low occupancy due to the pandemic, and currently 18 of its 30 hotels in Germany are open, “with six of the temporarily closed hotels being refurbished and rebranded to Premier Inn.”

“Despite this, we were able to materially accelerate the growth of our hotel network [in Germany] … with a total open and committed pipeline now standing at 72 hotels, providing a very strong platform from which to increase our brand presence,” she said.

Cadbury said the company’s financials have been strengthened over the past 12 months by a rights issue — valued at 1 billion pounds sterling — that was completed in June 2020 and 550 million pounds sterling in bonds issued in February to fund sustainability initiatives.

He said capital expenditure across the next financial year is expected to be more than 350 million pounds sterling — 67% of which will be deployed in the U.K., and the rest in Germany.

“It is critically important that we remain focused on ensuring we have a lean and agile cost base, and we are not extending our long-term efficiency program to target an additional 100 million pounds sterling of cost savings that will be delivered over the next three years,” Brittain said.

She added the firm’s non-exposure to meetings and events business also will help the company bounce back in “a more restrained competitor set” post-COVID-19.

“Operating costs were of course substantially lower than last year, driven by discretionary cost savings, the reduction of sales-related costs, suspension of business rates and actions we took to reduce labor costs in our support centers and across our sites,” Cadbury said.

As of press time, Whitbread’s stock was trading on the London Stock Exchange at 33.10 pounds sterling per share, an increase of 38.44% year to date. The London Stock Market overall was up 0.88% for the same time period.