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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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Presentation Transcript
alan parker

Alan Parker

chief executive, Whitbread PLC

premier lodge the transaction
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
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
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

premier travel inn7

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
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

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

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
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

David Richardson

finance director, Whitbread PLC

premier lodge high quality assets14
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

the acquisition assets
the acquisitionassets

Source: Vendor information * inc. long leases at peppercorn

incremental profit
incremental profit
  • Existing business
  • Underlying growth
  • Recent and new openings
  • Revenue enhancement
  • Cost synergies
incremental profit existing business
incremental profitexisting business

Source: Vendor information

incremental profit from recent and new openings
incremental profitfrom recent and new openings

* Based on 2003 profit contribution per room

incremental profit revenue enhancement
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

a group perspective
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)
key ratios27
key ratios

Source: Whitbread PLC published accounts/vendor information

premier travel inn hotels and bedrooms
premier travel innhotels and bedrooms

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

whitbread budget hotels room growth 1997 2005

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
premier travel inn30

premier travel inn

management biographies

mike tye

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

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

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

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

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

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

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

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