Results round-up: Whitbread, Amec Foster Wheeler

Whitbread served up a fairly solid set of full year results and while it reported a good start to 2017, warned of a tougher consumer environment than last year for its Premier Inn hotels and Costs coffee shops.

Revenue in the 52 weeks to 2 March of £3.1bn was up 8.2%, or 6.3% on a 53-week basis as the previous year was a 53-week year, which was in line with consensus forecasts of £3.1bn.

Premier Inn saw revenue per available room (revpar) decline 0.6% and Costa Coffee's UK like-for-like sales grow 2%, which was down from the 3% gain after nine months of the year due to a LFL fall of 0.8% in the fourth quarter.

Group underlying profit before tax grew 6.2% to £565.2m, as Premier Inn and the gastro-pubs increased underlying operating profits 7.4% to £468m and Costa by 5.3% to £158m.

Reported PBT climbed less than expected, up 5.7% to £515.4m, with the consensus forecast for the FTSE 100 group to serve up pre-tax profit of £554m.

Underlying basic earnings per share increased 6% to 246.48p, marginally ahead of the 245p consensus.

While Premier Inn grew total sales growth 9%, and LFL sales 2.3%, its opening programme of 3,816 gross new UK rooms during the year diluted LFL revpar 2%, which was only partially balanced by revpar growth of 1.4% in areas where no capacity was added.

With eight new restaurants opened, this part of the group increased sales 1.2%, though LFL sales shrank 0.3%, though this was said to be slightly ahead of competitors.

Costa, which 255 net new stores worldwide and installed 1,585 Costa Express machines, saw LFL sales decline in the fourth quarter due to the timing of the end of the quarter and saw margins shrink 0.8% points, not quite as bad as its previous guidance due to the phasing of investments into 2017/18.

With £860.1m of cash generated from operations, of which £610m was poured into capital investments and a full year dividend that is proposed to be raised 6% to 95.80p a share.

Chief executive Alison Brittain said the group made good progress in delivering on its three strategic priorities: UK and international growth and building the capability and infrastructure to support long-term growth, including November's £150m cost efficiency programme.

In Costa she highlighted innovations to drive sales growth and including an investment to introduce 'finer' coffee concepts, leveraging a new state-of-the-art roastery and delivering fresher food later this year.

Amec Foster Wheeler

Amec Foster Wheeler posted its final, audited results for the 2016 year on Tuesday, confirming they were “in line” with the 13 March update it released last month.

The FTSE 250 company reported an underlying 8% decline in adjusted revenue to £5.44bn, with adjusted trading profit falling 15%, or 22% on an underlying to £318m.

Its trading margin was down 110 basis points at 5.8%.

Adjusted profit was off 24% at £254m, and trading cash flow was down 3% to £375m.

The firm’s cash conversion stood at 118%, compared to 104% in 2015.

Adjusted diluted earnings per share ended the year down 26% at 50.4p.

The year-end net debt-to-EBITDA covenant ratio was 3.3x, and the board said a restated covenant was agreed with lenders of up to 4.5x until June 2018

There was also confirmation that no final dividend was being recommended, though it did say its non-core disposal programme remained “on track”.

Amec Foster Wheeler’s board also projected that a shareholder vote on the offer from Wood Group was expected in June.

“Given conditions in natural resources end markets, our 2016 trading performance was robust, as we benefited from the breadth of our business - especially the record performance from solar - cost saving actions and the fall in sterling in the second half of the year,” said chief executive officer Jon Lewis.

“We continue to expect another year of decline in oil and gas activity in 2017 and for solar activity to reduce significantly from the record levels seen in 2016.”

Lewis said the board also expected that there would be a “better performance” from environment and infrastructure, and a further significant contribution from standalone overhead cost savings.

“This year, we will continue to leverage the outstanding technical expertise of our people to best serve our customers and deliver projects safely across all the markets in which we operate.

“This and the improvements we have made to the business will ensure we continue to make significant progress in 2017.”