Whitbread says it intends to replace all of the 197 remaining restaurants within its portfolio with a more efficient integrated F&B offering.
The move is part of a refocusing on the business’ UK & Ireland growth plan by investing in its higher returning hotel business, with a longer-term potential to reach up to 125,000 rooms.
Whitbread has already agreed the sale of 51 branded restaurants for £50m last year, including sites under the Beefeater, Brewers Fayre, and Bar+Block brands.
The cuts are expected to affect about 12% of Whitbread’s 30,000-strong UK workforce at its Beefeater and Brewers Fayre restaurants, which are typically located next to, or inside, Premier Inn hotels.
Whitbread says it expects a £40m reduction in adjusted profit before tax as it transitions the remaining branded restaurants.
It plans to reduce gross capex by £1bn and recycle £1.5bn of its freehold property to fund future growth, while looking to grow on a leasehold basis and says continues to benefit from a substantial freehold estate.
“In the UK, we made excellent progress on each of our strategic initiatives and Premier Inn again outperformed the wider market, supported by the strength of our customer offer and the benefits of our commercial programme,” says Dominic Paul, Whitbread chief executive.
“Against a challenging consumer and macroeconomic backdrop, we continue to deliver material cost savings and plan to drive more in FY27, while delivering a fantastic service for our guests.
“Our New Five-Year Plan is a significant step for the group. Whilst the proposed extension of the Accelerating Growth Plan will impact profits in FY27, our new plan will make our assets work harder while creating a stronger, higher-returning business that delivers for our guests, teams and shareholders.”