Whitbread (LSE:WTB) on Thursday told investors that the UK Budget measures on business rates will deliver a "significant positive impact" on its financial performance, with preliminary estimates pointing to savings of between £45m and £60m by the 2029 financial year.
The Premier Inn owner, which is in the middle of a five-year plan to reposition itself as a leaner, higher-margin hotel operator, said the government has frozen business rates for hospitality businesses in England for two years, capping increases at inflation rather than the steeper rises previously expected.
Whitbread estimates its total business rate payments will now rise by only £7.5m to £12.5m in the 2028 financial year, against a previous consensus increase of around £35m, with a similar benefit expected the following year.
"The business rate measures announced in the UK Budget will do much to mitigate the damaging impact of the past two Budgets on the hospitality sector, and we are grateful that the Government has listened to our concerns," said chief executive Dominic Paul, adding that a "more reasonable increase" in the national living wage and minimum wage would also make a significant difference to the business.
Read more about Whitbread
- 13/10/26Whitbread profit falls as restaurant overhaul costs bite
- 18/06/26Whitbread posts 2% sales growth as Premier Inn outperforms UK hotel market
- 30/04/26Panmure Liberum eyes 'strategic pivot' at BUY rated Whitbread
Paul said the measures provide "further momentum" as the group executes its Five-Year Plan, which targets £2bn of free cash flow available for shareholder returns by FY31 alongside a 500 basis-point uplift in group return on capital employed.
Whitbread said it would provide full FY28 UK cost inflation guidance, including the estimated impact of the Budget, at its third-quarter trading update in January 2027.