Whitbread share price falls after Q1 sales plummet
The British multinational hotel and restaurant group saw its share price slump on Tuesday after its first quarter (Q1) earnings showed a major dip in sales.
Whitbread has seen its share price fall more than 4% in early morning trading after the company unveiled a signifcant slump in sales in its first quarter results.
Sales at the British hotel and restaurant group fell by 79.4% in its first three months of trading as a result of the coronavirus pandemic, with the company hoping to bounce back from the crisis now that the majority of its sites will reopen by the end of July.
‘We are very pleased to have commenced the reopening of our hotel and restaurant estates, which are now able to welcome all business and leisure guests. In the UK we currently have over 270 hotels open and expect the majority of the remainder of the estate to be open by the end of July, Whitbread CEO Alison Brittain said in a statement.
‘In Germany all of our 19 operational hotels are open, including 13 that were refurbished and rebranded as Premier Inn during the lock-down period,’ she added.
The company admitted that it is still too early at this stage to draw any conclusions from the early bookings its restaurants and hotels have received so far. But the business did say that regional tourist destinations are seeing good demand, with travellers eager to have a summer holiday in spite of fears of a second wave of coronavirus cases.
Whitbread shares are trading at £23.33 at the time of publication, with the stock down 44% year-to-date.
Whitbread completes £1 billion rights issue
‘The successful completion of the £1bn rights issue on 10 June will enable us to maintain our competitive advantage and financial flexibility, as we have both strengthened our balance sheet and secured the business so it can withstand a long period of low revenues,’ Brittain said in the company’s Q1 results.
‘Our strong balance sheet, alongside both our leading operating model and the power of our brands, means that we are in the best possible position to take advantage of enhanced structural opportunities that we expect to become available in both the UK and Germany,’ she added.
The billion pound rights issue at £15 a share will not only strengthen its balance sheet during these unprecedented market conditions, but also help the hotel and restaurant owner take advantage of cheaper land prices in the UK and Germany in the wake of the coronavirus crisis.
How to trade stocks with IG
Looking to trade Whitbread and other stocks? Open a live or demo account with IG and buy (long) or sell (short) shares using derivatives like CFDs and spread bets in a few easy steps:
- Create an IG trading account or log in to your existing account
- Enter ‘Whitbread’ in the search bar and select it
- Choose your position size
- Click on ‘buy’ or ‘sell’ in the deal ticket
- Confirm the trade
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Act on share opportunities today
Go long or short on thousands of international stocks with spread bets and CFDs.
- Get full exposure for a comparatively small deposit
- Trade on spreads from just 0.1%
- Get greater order book visibility with direct market access
See opportunity on a stock?
Try a risk-free trade in your demo account, and see whether you’re on to something.
- Log in to your demo
- Take your position
- See whether your hunch pays off
See opportunity on a stock?
Don’t miss your chance – upgrade to a live account to take advantage.
- Trade a huge range of popular stocks
- Analyse and deal seamlessly on fast, intuitive charts
- See and react to breaking news in-platform
See opportunity on a stock?
Don’t miss your chance. Log in to take advantage while conditions prevail.
Live prices on most popular markets
- Equities
- Indices
- Forex
- Commodities
Prices above are subject to our website terms and agreements. Prices are indicative only. All share prices are delayed by at least 15 minutes.
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
