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Whitbread PLC. premier travel inn the acquisition of Premier Lodge and 19 pub restaurants . July 2004. Alan Parker. chief executive, Whitbread PLC. Premier Lodge the transaction. £536.2m acquisition £505m acquisition of 132 hotels + 9 development sites

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Premier travel inn the acquisition of premier lodge and 19 pub restaurants l.jpg

Whitbread PLC

premier travel inn the acquisition of Premier Lodge and 19 pub restaurants

July 2004


Alan parker l.jpg

Alan Parker

chief executive, Whitbread PLC


Premier lodge the transaction l.jpg

Premier Lodgethe transaction

  • £536.2m acquisition

    • £505m acquisition of 132 hotels + 9 development sites

    • £31.2m acquisition of 19 pub restaurants

  • Earnings enhancing in first full year (2005/6)

  • To generate 10%+ return on investment in second full year (2006/7)


Premier travel inn l.jpg

premier travel inn

  • Clear leader in growth sector

  • Platform for strong sales growth

    • increase occupancy in acquired hotels

    • reduce discounts and improve overall sales mix

  • Cost synergies


Premier travel inn6 l.jpg

premier travel inn

  • The UK’s biggest hotel brand

  • 461 locations* across the UK

  • 29,141 bedrooms*

* Includes hotels committed for development but not yet built


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Number of bedrooms

29,141

30,000

25,000

20,000

14,213

15,000

9,304

10,000

5,503

5,000

0

Premier Travel

Travelodge

Express by

Ibis

Inn

Holiday Inn

Travel Inn

Premier Lodge

Pipeline

premier travel inn

Source: Whitbread analysis of published company data


Premier travel inn fast integration l.jpg

premier travel innfast integration

  • Detailed integration plans in place:

    • People

    • Systems

    • Properties

    • Supply chain

    • New brand launch

  • Completed by March 2005


A growth sector use of branded budget hotels l.jpg

Guests (millions)

6

17% CAGR

5

4

3

2

1

0

1999

2000

2001

2002

2003

Business

Leisure

a growth sector use of branded budget hotels


An underdeveloped sector branded budget hotels as a percentage of total rooms available uk l.jpg

14%

12%

12%

10%

8%

6%

6%

4%

2%

0%

Total accommodation

Total hotels market

an underdeveloped sectorbranded budget hotels as a percentage of total rooms available (UK)

Source: Whitbread analysis of data from BHA/VisitBritain/University of Huddersfield


Premier travel inn the competitive edge l.jpg

premier travel innthe competitive edge

  • Strong product consistency

  • Nationwide coverage

  • World class reservation system

  • Transparent pricing

  • 100% Satisfaction Guarantee

  • Top quality pub restaurants


David richardson l.jpg

David Richardson

finance director, Whitbread PLC


Premier lodge high quality assets l.jpg

the pipeline

Premier Lodgehigh quality assets

Source: Vendor information


Premier lodge high quality assets14 l.jpg

Premier Lodgehigh quality assets

  • 48% of Premier Lodge rooms opened within last four years

  • 88% of lodges built or refurbished completely within last three years

  • 19 pub restaurants re-branded to Brewers Fayre by March 2005

Source: Vendor information


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the acquisitionassets

Source: Vendor information * inc. long leases at peppercorn


Incremental capital employed l.jpg

incremental capital employed


Incremental profit l.jpg

incremental profit

  • Existing business

  • Underlying growth

  • Recent and new openings

  • Revenue enhancement

  • Cost synergies


Incremental profit existing business l.jpg

incremental profitexisting business

Source: Vendor information


Incremental profit from recent and new openings l.jpg

incremental profitfrom recent and new openings

* Based on 2003 profit contribution per room


Incremental profit revenue enhancement l.jpg

incremental profitrevenue enhancement

  • c.£8m additional PBIT through greater occupancy and sales synergies:

    • reservations

    • cross-sell

    • estate density

    • heightened consumer awareness

Benefits accruing to both Premier Lodge and Travel Inn estates


Incremental profit cost synergies l.jpg

incremental profitcost synergies


One off costs l.jpg

one-off costs


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a group perspective

  • Gearing (2003/4 pro forma) – 65%(38% pre-acquisition)

  • Interest cover (2003/4 pro forma) - 3.7 x(5.6 x pre-acquisition)

  • EPS enhancing in first full year (2005/6)

  • Return on investment to exceed 10% in second full year (2006/7)


Appendix l.jpg

appendix


Key ratios l.jpg

key ratios


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key ratios

Source: Whitbread PLC published accounts/vendor information


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premier travel innhotels and bedrooms

* Spirit continues to operate an additional seven hotels (229 bedrooms) under a franchise agreement with Whitbread


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30,000

25,000

20,000

15,000

10,000

5,000

0

1996/7

1997/8

1998/9

2000/1

2001/2

2002/3

2003/4

2004/5E

1999/00

Whitbread budget hotelsroom growth 1997-2005


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premier travel inn

management biographies


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Career highlights

  • joined Travel Inn as managing director in 2003

  • 2001-3: managing director, Costa

    Also

  • marketing & strategic planning director, Whitbread Restaurants

  • sales & marketing director, Whitbread Inns

  • managing director, Aramark Food Services Plc

    Age50

Mike Tye

managing director, premier travel inn


Neil cooper l.jpg

Career highlights

  • joined 2002 as finance director, Travel Inn

    Also

  • planning director, Pizza Hut

  • strategic finance project manager, Whitbread

  • PwC Management Consulting

  • several senior finance positions with Reckitt & Coleman

    Age37

Neil Cooper

finance director, premier travel inn


Gill baker l.jpg

Career highlights

  • joined Travel Inn as sales and marketing director in April 2001

    Also

  • joined Unilever in 1987 as a systems engineer before moving into marketing

  • gained widespread experience working across a number of food brands in different European markets

  • in August 98 promoted to marketing controller for margarine and spreads

    Age39

Gill Baker

sales and marketing director, premier travel inn


Paul flaum l.jpg

Career highlights

  • operations director - Managed Travel Inn

  • previously regional operations director for MTI’s North

    Also

  • strategic planning & business analysis manager (leisure division), The Rank Group

  • regional manager London & South, Odeon Cinemas Ltd

  • regional director, London & South, Odeon Cinemas Ltd

    Age33

Paul Flaum

operations director, (managed) premier travel inn


Darroch crowford l.jpg

Career highlights

  • operations director for Travel Inn

  • 2 years operations director Brewers Fayre/Brewsters

    Also

  • 6 years with Hilton Hotels

  • 8 years with Forte Hotels

  • 13 years with Thistle Hotels – trainee to general manager

  • general manager White House Hotel, Herm, Channel Islands

    Age51

Darroch Crowford

operations director, premier travel inn


Deborah parker l.jpg

Career highlights

  • joined June 2003 as property director

    Also

  • head of acquisitions then head of development, Kingfisher

  • head of property, BAA

  • various senior positions in other leisure companies such as Rank/Luminar

  • developed property side of the BigW chain, Woolworths

    Age40

Deborah Parker

property director, premier travel inn


Tim painter l.jpg

Career highlights

  • joined 2003 as HR Director – Travel Inn

  • HR director – Endeva

    Also

  • HR director Thorn Managed Services

  • head of HR – Thorn UK

  • compensation & benefits mgr, Thorn UK

  • Safeway Stores plc

  • Asda stores

    Age34

Tim Painter

human resources director, premier travel inn


Susan thomas l.jpg

Career highlights

  • joined in April 1998 as IT Director

  • previously business systems manager, finance services division, Whitbread

    Also

  • project accountant, services division, Whitbread

  • senior business consultant, Whitbread

    Age40

Susan Thomas

systems director, premier travel inn


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