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BuildingBuilding
advantage
on our
Annual Report and Accounts 2023/24
Premier Inn Swindon Town Centre, our first all-renewable energy hotel
Our year at a glance
Statutory revenue
£2,960m
2022/23 £2,625m
Adjusted profit before tax†
£561m
2022/23 £413m
Statutory basic earnings
pershare†
161.0p
2022/23 138.4p
Adjusted operating cash flow†
£787m
2022/23 £719m
Total shareholder returns*
£756m
2022/23 £119m
Statutory profit before tax
£452m
2022/23 £375m
Adjusted basic earnings
pershare†
206.9p
2022/23 162.9p
Dividend per share
97.0p
2022/23 74.2p
Lease-adjusted net debt to
adjusted EBITDAR†
2.9x
2022/23 2.6x
Whitbread owns Premier Inn, the UK’s biggest
hotel brand, operating over 85,000 rooms in over
850 hotels. We also have a significant and growing
presence in Germany, where we have 59 hotels
open and where we are determined to replicate our
UK success to become the number one hotel brand.
Our scale and passion for excellence mean
we can deliver a great guest experience at an
attractive price whilst also continuing to invest
inouroperations.
* Total shareholder dividends and share
buy-backs paid in 2023/24.
† See pages 231 to 237 for definitions of
alternative performance measures. This
footnote is referenced throughout the report.
Throughout this report and unless stated
otherwise, all percentage growth
comparisons are made comparing the
latest year (2023/24) performance with
that of the prior year (2022/23).
Whitbread PLC Annual Report and Accounts 2023/24
STRATEGIC REPORT G F O 1
Guest proposition
Contents
Strategic report
2 Purpose roadmap
3 Brands and locations
4 Why invest?
6 Chairman’s statement
8 Chief Executive’s review
12 Strategy in action:
Guestproposition
14 Business model
16 Strategy and KPIs
18 Stakeholder engagement
24 Strategy in action: Estate
growth and optimisation
26 UK market drivers
28 UK strategy
30 UK performance
32 German market drivers
34 German strategy
36 German performance
38 Strategy in action: Technology
40 Long-term growth strategy
and performance
42 Chief Financial
Officer’sreview
46 Strategy in action: Teams
48 Chief People Officer’s review
56 Strategy in action: Force
forGood
58 Force forGood: Strategy
60 Force forGood: Materiality
61 Force forGood: Opportunity
62 Force forGood: Community
63 Force forGood: Responsibility
64 Risk management
66
Principal risks and uncertainties
72 Viability statement
73
Non-financial and sustainability
information statement
74 Climate-related financial
disclosures
Governance
98 Corporate governance
ataglance
100 Chairman’s statement
102 Corporate governance
statement
104 Board leadership and
company purpose
106 Division of responsibilities
107 Board of Directors
111 Executive Committee
112 Composition, succession
andevaluation
114 Nomination Committee report
116 Audit Committee report
122 Remuneration Committee
report
126 Remuneration at a glance
128 Directors’ remuneration policy
129
Annual report on remuneration
142 Directors’ report
148 Directors’ responsibility
statement
149 Independent limited
assurance report
Consolidated accounts
2023/24
153 Independent auditor’s report
162 Consolidated income
statement
162 Earnings per share
163 Consolidated statement of
comprehensive income
164 Consolidated statement of
changes in equity
165 Consolidated balance sheet
166 Consolidated cash flow
statement
167 Notes to the consolidated
financial statements
Whitbread PLC Company
accounts 2023/24
217 Company balance sheet
218 Company statement
of changes in equity
219 Notes to the Company
financial statements
Other information
230 Glossary
231 Alternative performance
measures
238 Shareholder services
Our sustained programme of investment across all areas
of our operations is driving our differentiated and proven
business model to deliver attractive levels of return.
Teams
Technology
A Force for Good Governance
Find out more online
www.whitbread.co.uk/
See page 56 See page 98
Find out more about
ForceforGood in our
ESGReport 2023/24
See page 46
See page 12
Estate growth
and optimisation
See page 24 See page 38
BuildingBuilding
advantage
on our
Whitbread PLC Annual Report and Accounts 2023/24
2 STRATEGIC REPORT
“ Our ambition is to
be the world’s best
budget hotel brand.”
Dominic Paul
Chief Executive
Strategic framework
Force for Good is our long-established
sustainability programme. Within
each aspect of our business strategy
are stretching targets that are fully
embedded across ourbusiness.
Opportunity
Supporting our team members so they
canreach their potential with no barriers
toentry and no limits to ambition
Community
Making a meaningful contribution to the
customers and communities we serve
Responsibility
Always operating in a way that respects
people and the planet
Find out more online
www.whitbread.co.uk
See page 58
Force for Good
To provide quality, affordable hotel
rooms to our guests, to help them to
live and work well and to positively
impact the world around us.
With no barriers to entry or limits to
ambition, we will provide meaningful
work, skills and career development
opportunities for our teams.
See page 52
What
sets us
apart?apart?
Our purpose
PURPOSE ROADMAP
s
u
p
p
o
r
t
l
o
n
g
-
t
e
r
m
g
r
o
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t
h
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o
c
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s
o
n
o
u
r
s
t
r
e
n
g
t
h
s
i
n
t
h
e
U
K
See pages 16 to 17
G
r
o
w
a
n
d
i
n
n
o
v
a
t
e
E
n
h
a
n
c
e
o
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r
c
a
p
a
b
i
l
i
t
i
e
s
t
o
t
o
g
r
o
w
i
n
G
e
r
m
a
n
y
Force for
Good
Whitbread PLC Annual Report and Accounts 2023/24
STRATEGIC REPORT G F O 3
BRANDS AND LOCATIONS
United Kingdom
Our largest and most profitable market is
driven by high volumes of domestic travel
with additional inbound travel from
international markets. With a significant
decline in the independent sector and
limited new room growth from other
branded operators, a favourable supply
backdrop is expected to continue for a
number of years.
Germany
The German hotel market is 40% larger
than the UK and shares a number of
attractive structural characteristics that
helped drive Premier Inn’s success in the
UK. Having grown rapidly in recent years,
we are on course to become Germany’s
number one hotel brand, delivering
profitable growth and attractive
long-term returns on capital.
Long-term ambition to become
No.1
Where we operate
1
Hotels
Food and beverage
Food and beverage, especially a hot breakfast, is a key part of the overall guest
experience at Premier Inn. Our guests have access to either an unbranded integrated
restaurant within the hotel or a branded restaurant just next door.
Read more on pages 26 to 29
‘hub by Premier Inn’ offers a more compact, digitally
advanced in-room experience at a great price in prime
locations. With 17 hub hotels already open across
London andEdinburgh, we have a committed
pipelinetoopen more sites over the nextfew years.
Premier Inn is the largest hotel brand in the UK and has a growing
presence inGermany. Our consistent guest proposition is synonymous
with providing high-quality and great value hotel rooms. We have a
long runway for growth; with our committed and future pipeline, as
well as our extensions programme, we will reach at least 97,000+ open
rooms in the UK by 2028/29.
Open rooms
3
10,500
Our brands
UK long-term room potential
125,000
Open rooms
2
85,000
1 As at 29 February 2024.
2 Includes six sites in Ireland, one site in each of
Guernsey and the Isle of Man and two sites in Jersey.
3 Includes one site in Austria.
4 Sites where the Group has a legal interest in a
property with the intention of opening a hotel
in the future.
Committed pipeline
4
7,000
Committed pipeline
4
6,000
Read more on pages 32 to 35
Whitbread PLC Annual Report and Accounts 2023/24
4 STRATEGIC REPORT
With over 85,000 rooms open and a further 7,000 rooms
in our pipeline, we have significant growth potential of up
to 125,000 rooms across the UK and Ireland. The structural
shift in UK hotel supply following the pandemic and a
subdued pipeline of new build hotels means we do not
expect UK supply to recover to 2019 levels until at least
2028. Our in-house acquisition team, large freehold
portfolio and flexible approach to property ownership
means that we are well-placed to take advantage of
thissignificant market opportunity and can add rooms
through new sites and extensions.
WHY INVEST?
Whitbread owns Premier Inn, the UK’s largest
hotel brand, and is also on course to become
the number one hotel brand in Germany. The
Group employs over 38,000 people and is a
long-term constituent of the FTSE 100 index.
Investment case
1 | Long-term UK growth opportunity
Open and
committed
rooms
Mid-term
rooms
target
92,000
97,000+
125,000
The opportunity to create substantial value in Germany
is significant. With similar characteristics to the UK market,
Germany has a large and declining independent sector
but, unlike the UK, has no clear leader in the branded
budget segment. Following the opening of our first
hotel
in 2016, we have grown rapidly through a combination
of
both organic growth and acquisitions. At the end of
2023/24, we had a total of 93 hotels in our open and
committed
pipeline, making us one of the largest
operators in the market. We have committed £1.1bn
ofcapital and have a clear strategy in place to become
the number one hotel brand in Germany and reach
long-term returns on capital of between 10–14%.
Our operating model gives us a significant competitive
edge. Ownership of all aspects of our operations ensures
the delivery of a consistent, high-quality product,
whilst our scale and financial discipline mean we can
continue to offer great value for our guests. Our in-house,
centralised approach to revenue management integrates
digital marketing into our trading strategy, helping us
to maximise revenue. Almost all of our bookings are
made direct, significantly lowering our acquisition and
retention costs.
We are evolving our offer to ensure that we uphold our
brand promise and continue to delight our guests. Our
food and beverage offer drives incremental RevPAR
and our planned changes to optimise our offer will
further enhance the guest experience. Our Force for
Good sustainability programme ensures we are contributing
positively to the communities where we operate.
YouGov BrandIndex
1
Open hotels*
59
Pipeline hotels
34
2 | Unlocking value in Germany
3 | Differentiated operating model delivers a market-leading customer proposition
Long-term
potential rooms
Quality
Hilton
Marriott
Premier Inn
Crowne
Plaza
Best
Western
Holiday Inn
Airbnb
Holiday Inn Express
Ibis
Travelodge
30
40
20
10
0
10 20 30 40
50
Value
1 YouGov BrandIndex Quality & Value scores as at 29 February 2024 based on a nationally representative 52-week moving average.
* Includes one hotel in Austria.
Premier Inn UK Return on capital
Whitbread PLC Annual Report and Accounts 2023/24
STRATEGIC REPORT G F O 5
Our vertically integrated business model, continued
capital discipline and diligent execution of our business
strategy have combined to deliver strong growth and
attractive rates of return. This year, our UK business
reached record levels of returns whilst we continued
togrow our estate.
Since 2019/20, we have added almost 7,000 rooms
across the UK and Ireland and increased our return on
capital employed† (ROCE).
In 2023/24, our UK estate stood at over 85,000 rooms
and we achieved ROCE† of 15.5%. We aim to drive this
higher through optimisation of our estate, as wellas a
series of commercial initiatives and operating efficiencies.
Whilst still in its early stages of development, we believe
that our German business, once mature, will deliver
strong growth and attractive long-term returns.
COVID-19 pandemic
85k
65k
68k
72k
76k
79k 79k
82k
84k
59k
Number of UK rooms Premier Inn UK ROCE†
13.5%
12.9%
13.0%
13.4%
13.3%
11.2%
2.3%
12.9%
15.5%
(14.4)%
With an upgraded investment grade
2
rating of BBB,
atthe year-end we had net debt† of £298m. We have
a strong balance sheet that underpins our confidence
in being able to continue to invest, even through
periods of macroeconomic uncertainty. Our balance
sheet is backed by a substantial freehold property
portfolio that provides operational flexibility and is a
potential source of future funding through selective
sale and leaseback transactions. It also enables us to
maximise the commercial opportunity in any location
and optimise our portfolio by extending existing sites,
closing sub-scale hotels and opening bigger, more
efficient hotels, thereby maximising returns.
2 Fitch Ratings, 17 August 2023.
Freehold : Leasehold mix
4 | Increased returns on a growing capital base
5 | Asset-backed balance sheet
provides stability and enables growth
FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24
Open
Freehold
Leasehold
52%
48%
Freehold
Leasehold
52%
48%
Open and
committed
Premier Inn UK returns
Whitbread PLC Annual Report and Accounts 2023/24
6 STRATEGIC REPORT
CHAIRMAN’S STATEMENT
The past year has seen us
deliver another outstanding
financial performance. The
execution of our business
strategy, supported by our
strong market position and
differentiated business model,
is extending our leadership
position in the UK and we are
making encouraging progress
towards replicating that success
inGermany.
Our strong performance ensures we can
continue to invest in our existing business, as
well as in new opportunities to drive long-term
returns for the benefit of our stakeholders.
Our results are underpinned by the continued
dedication and hard work of our teams. Their
passion and focus on operational excellence
ensures that, even at high levels of hotel
occupancy, we are continuing to deliver a
high-quality and great-value experience for
our guests. Sustaining our market-leading
customer proposition requires that we continue
to evolve our business, balancing the needs
of each of our key stakeholders, backed up
by a process of rigorous oversight, performance
management and our Force for Good
sustainability programme. Tailoring the way
we provide food and beverage in a number
of our UK locations is a further example of
this process in action. As set out in the Chief
Executive’s review, our planned changes to
our branded restaurant portfolio will improve
the service to our hotel guests, unlock the
addition of new high-returning hotel rooms
and increase efficiencies. Whilst there will
be an impact on some of our team members,
we will seek to offer alternative opportunities
across the Group wherever possible.
The nature of our business requires that
wetake a long-term view when it comes
tocapital allocation. This approach has
served us well over the past 280 years and
is building on our advantage, opening up
newopportunities for future growth and
increasing financial returns.
Full-year results and
finaldividend
Premier Inn UK remained the engine of
growth in 2023/24, supported by further
progress in Germany and increased interest
receivable on our cash balances. Group
statutory profit before tax was £452m, an
increase of £77m versus the prior year after
£109m of adjusting items (including £107m
of impairments).
Our vertically integrated business model
ensures we have control over the guest
experience and provides us with significant
operating leverage, generating strong
cashflow of £787m over the past year.
Asaresult, we were able to continue to
self-fund our programme of investment,
with expansionary and non-expansionary
capex totalling £509m in 2023/24. Our
balance sheet remains strong, as reflected
by the improvement in our investment
grade rating to BBB in August 2023
1
.
Given our strong performance and confidence
in the outlook, the Board is recommending
a final dividend of62.9 pence per share,
a26% increase fromlast year and a further
£150m share buy-back. The final dividend
will be paid on 5 July 2024 to shareholders
on the register on 24 May 2024.
As in previous
years, the Dividend Reinvestment
Plan (DRIP)
will enable eligible shareholders to receive
theirdividend entitlement in the form of
additional Whitbread shares.
Find out more online
www.whitbread.co.uk
1 Fitch ratings, 17 August 2023.
on our
opportunity
BuildingBuilding
Adam Crozier
Chairman
Whitbread PLC Annual Report and Accounts 2023/24
STRATEGIC REPORT G F O 7
With our continued commitment to the
environment as part of our Force for Good
agenda, and in response to a rise in the
number of uncashed dividend cheques,
wehave decided that in future cash dividend
payments will only be made by electronic
means. This will start with the interim dividend,
which we expect to pay in December 2024.
From that point on we will no longer be
issuing payments by cheque. Further details
on how you can register your bank account
details, so you can have dividends paid
directly to your account, can be found in
the shareholder services section of the
reporton page 238.
Strategy
Our strategy is unchanged and we are
continuing to seek ways in which we can
refine and improve our business. Examples
include the further optimisation of our UK
estate, continued progress in Germany, our
upgraded technology platform and our new
£150m efficiency programme. Further detail
on these and our other commercial initiatives
is set out in the ChiefExecutive’s review on
pages 8 to 11, explaining how they are
helping to ensure we continue to deliver a
quality experience for our guests, provide
rewarding employment for our teams and
attractive long-term returns for our shareholders.
Capital allocation
Retaining a strong balance sheet with
investment grade metrics remains a key
pillar of our capital allocation framework.
Having considered carefully the Group’s
financial performance and overall business
outlook, the Board is pleased to be able to
announce a further £150m share buy-back,
which is in addition to the £600m that was
returned over the past year.
Further details regarding the latest
sharebuy-back can be found in the
ChiefExecutive’s review on pages 8 to 11
Force for Good
An integral part of our strategy is our
sustainability programme, Force for Good.
We remain focused on delivering against
the three pillars of our programme: opportunity,
community and responsibility.
During the year we continued to invest in
our teams, not just through increased levels
of pay but also through initiatives such as
our apprenticeship programme that is helping
to provide those at the start of their careers
with an opportunity to acquire new skills and
build a career with us at Whitbread.
We have made good progress with our
operational carbon and water reduction
andcontinue to trial solutions that will
further decarbonise our estate. In addition,
we have started preparing for the Corporate
Sustainability Reporting Directive, including
our double materiality assessment
.
Our partnership with Great Ormond Street
Hospital Children’s Charity has now raised a
total of over £24m in the UK and during the
past year we donated over 50,000 pieces
of bedding and 2,000 mattresses to those
impacted by the conflict in Ukraine.
You can read more about our Force for Good
commitments and progress during the past
year on pages 61 to 63
The Board
I am pleased to report that Dominic Paul’s
arrival as Chief Executive last year has been
hugely positive. Dominic’s understanding of
our business approach has allowed us to
progress at pace on a number of key initiatives,
whilst continuing to deliver outstanding
financial results. Dominic summarises our
progress over the past year as well as some
of our future plans in his review.
During the year we appointed Shelley Roberts
as a non-executive director. Shelley brings
awealth of experience from her current role
as Chief Commercial Officer at Compass
Group PLC, as well as from her previous
roles in the international airline industry
andshe is already proving to be a valuable
addition to the Board.
Both David Atkins and Fumbi Chima have
confirmed that they will not seek re-election
at this year’s forthcoming AGM. I would like
to take this opportunity to thank them on
behalf of the Board for the significant
contribution that they have both made to
our progress and to wish them well forthe
future. Their decision to step down presents
an opportunity to review the size and shape
of the Board whilst continuing tomake sure
that we progress towards our 40% target of
female Board members, as recommended
by the FTSE Women Leader’s review.
Although we donot yet have a female
appointee in one of the top four senior
positions, we are committed to achieving
this goal and will provide further updates
infuture reports.
Governance
Whilst satisfied that our governance
approach is robust and effective, we are
notcomplacent and I have welcomed input
from a number of our investors with whom
Ihave met during the past year. Hearing
first-hand their views on a range of topics
including business strategy and culture,
remuneration, environmental, social and
governance matters as well as financial and
operational performance has been most
useful in helping to inform how we think
about and oversee all areas of our business.
Executive remuneration remains a key
areaof focus both for the Board and the
Remuneration Committee. As explained by
the Chair of the Remuneration Committee
on pages 122 to 124, our executives and
wider teams are incentivised to achieve
what the Board believes are stretching
targets so that their interests and those
ofour shareholders and other stakeholders
arealigned.
Annual general meeting
The AGM will take place at 2.30pm on Tuesday
18 June 2024 at our head office inDunstable
and full details of the meeting are set out in
the Notice of Meeting. For those able to
attend, my colleagues and I look forward to
welcoming you then.
In the last couple of years we have provided
alive video stream of our AGM, together with
the opportunity to both vote and ask questions
remotely during the course of the meeting.
The number of shareholders using this service
has been very low and does not justify the cost.
We have therefore taken the decision to scale
back the online element of the meeting this
year, which will be available remotely via an
audio-only webcast.
Shareholders who are unable to attend
themeeting in person are welcome to
submit questions by email in advance of the
meeting to agmquestions@whitbread.com.
Any questions should be submitted by
5pmonMonday 17 June 2024. Votes can
besubmitted in person at the meeting or
inadvance via a proxy card or the online
proxy voting system, but it will not be possible
to vote online during the meeting.
Outlook
With expectations offurther reductions in
inflation and a more benign interest rate
environment on the horizon, there are reasons
to believe that the macroeconomic outlook
may be turning more favourable. Although this
would be welcome, we are not relying on this
to drive our business forward. We have a clear
strategy, a strong balance sheet and a number
of strategic and commercial opportunities that
underpin ourconfidence in being able to
deliver long-term profitable growth.
Adam Crozier
Chairman
29 April 2024
CHIEF EXECUTIVE’S REVIEW
Whitbread PLC Annual Report and Accounts 2023/24
8 STRATEGIC REPORT
We have delivered an
outstanding set of results in
2023/24, led by the strength
of our UK hotels business. Our
increased levels of profitability,
operating cashflow and return
on capital reflect the power of
our unique operating model.
Our freehold-backed balance
sheet, together with our strategy
of continuing to invest, is
allowing us to take advantage
of the significant structural
growth opportunity that exists
following the decline in UK
hotel supply, as well as expand
our network inGermany.
Against this backdrop, we are increasing
our momentum to deliver long-term profitable
growth. In addition to our strong commercial
programme, we have announced our
Accelerating Growth Plan (AGP) to optimise
our F&B offer at a number of our sites to
unlock up to 3,500 room extensions that
will enhance the service for our hotel guests
and deliver increased operational efficiencies.
In Germany, we are encouraged by our progress
to date and the opportunities we now have
to both build our brand awareness and
refine our trading strategies further. We are
on track to break-even on a run-rate basis
during calendar year 2024 and with 10,500
rooms now open and a further 6,000 in
thepipeline, we are on course to fulfil our
ambition of becoming the number one
hotel brand in Germany, based on number
of open hotel rooms.
Our scale and vertically integrated model
mean we have the commercial and operational
levers to underpin our long-term profitable
growth, strong cashflow and increasing
returns on capital. We are oncourse to
deliver a step change in our
performance
and look forward with confidence.
2023/24 Financial performance
The Group has once again delivered an
excellent financial performance. Whilst
Premier Inn UK remains the driving force
behind our latest results, our growing
German business also made encouraging
progress throughout the year. Total statutory
revenue increased by 13% to £2,960m while
adjusted operating profit increased by 24%
to £674m, reflecting the inherent operating
leverage of our model. We have continued
to build on our advantage across all areas
of our operations, with a determined focus
on growing our revenues, managing our
costs and ensuring a high-quality service for
our guests. As a result the Group delivered
a 36% increase in adjusted profit before tax
to £561m (2022/23: £413m). Adjusting items
inthe year resulted in a charge of £109m,
including a non-cash, net impairment
charge of £107m, most of which relates
toUK branded restaurants held for sale in
connection with our AGP, the impairment
ofseven properties in Germany and £27m
of costs relating to the Group’s strategic IT
programmes. The result was a 21% increase
in statutory profit before tax to £452m
(2022/23: £375m). A tax charge of £140m
ledto a statutory profit after tax of £312m
(2022/23: £279m).
Our financial strength means we can
continue to deliver attractive returns to
shareholders, through a combination of
dividends as well as share buy-backs. The
Board is therefore recommending a 26%
increase in the final dividend to 62.9p
pershare that will be paid to eligible
shareholders on 5 July 2024 and further
details can be found on page 184.
Dominic Paul
Chief Executive
DeliveringDelivering
a step-change
in performance
Whitbread PLC Annual Report and Accounts 2023/24
STRATEGIC REPORT G F O 9
UK – Extending our
marketleadership
Our UK business delivered an excellent
operational and financial performance.
Witha favourable supply backdrop and
strong demand, total UK accommodation
sales increased by 12%, with strong growth
across London (+17%) and the Regions
(+10%), driven by continued high levels of
occupancy and increased average room
rates (ARR). We maintained a well-balanced
customer mix between business and leisure
and whilst leisure demand remained strong
during the peak summer months, we did
see some softening at short-lead during the
fourth quarter, reflecting the normal seasonal
pattern. The result was that Premier Inn
UKagain outperformed the wider midscale
andeconomy (M&E) market and total
accommodation sales grew 3.1pp ahead
ofthe market with an increased RevPAR
premium of £5.95 in 2023/24 (2022/23: £4.96)
.
This outperformance was thanks to a
number of external and internal factors
including: a favourable supply backdrop;
our market-leading position; our proprietary
trading engine; the quality of our guest
experience; our focus on business customers
and operational excellence.
Food and beverage (F&B), especially a hot
breakfast, is an important part of our hotel
offer and helps drive incremental RevPAR.
F&B sales were up 7% versus 2022/23, with
high levels of occupancy in our UK hotels
driving strong breakfast sales that were up
14% year-on-year and a series of commercial
initiatives supporting the performance of
our branded restaurants.
As expected, with the addition of over
2,000 new hotel rooms and 8% cost
inflation, total operating costs increased
by8% versus the prior year. However, the
power of our operating model meant that
with positive like-for-like sales growth,
and£50m of efficiency savings, adjusted
pre-tax profits increased by 19% to £588m
(2022/23: £492m) and margins increased
to21.2%,
1.6pp ahead of the prior year
(2022/23: 19.6%). The strength of this
performance meant that we delivered
record levels of UK ROCE that increased
to15.5% (2022/23: 12.9%).
Gross impairment of £84m (2022/23: £nil)
has been recognised in respect of sites
impacted by changes to facilitate our AGP.
Included within this amount is £81m where
the carrying value exceeds the expected
sale proceeds less costs to sell and a further
impairment of £4m to reflect the impact of
the reduced cashflows as a result of the
announcement of the plan. This was offset
by the reversal of previous impairments
relating to these disposal sites of £7m. In
addition, gross impairment charges of £8m
(2022/23: £54m) have been driven by
changes to forecast cashflows at a small
number of sites and an amount of £10m
(2022/23: £55m) was recognised as reversals
of previous impairment driven by a strong
performance across other sites, particularly
those in London. This amount includes £1m
relating to the Premier Inn hotel remaining
following the expected disposal of the
neighbouring branded restaurant.
Germany – On course to
become the No. 1 hotel brand
In Germany, we made encouraging progress
in 2023/24, building our momentum with
further network expansion and improved
trading performance. Whilst we did
experience a dip in performance during the
second quarter, this was short-lived. Our
cohort of more established hotels in
aggregate performed well during the year
and, despite not yet at our long-term target
level of return, it is achieving RevPAR ahead
of the rest of the German M&E market.
We added 1,464 rooms during the year and
now have over 10,500 rooms open with a
further 6,000 rooms in our committed pipeline.
As our brand is not yet well known and with
only a limited trading history since the end
of the pandemic, our hotels are not yet at their
full potential.
However, we continue to be
encouraged by our improving performance,
led by our cohort of 17 more established
hotels
1
whichachieved a profit
2
of £9m in
2023/24 (2022/23: profit of £3m). The net
result was that Germany as a whole delivered
a reduced adjusted loss before tax of £36m
(2022/23: loss of £50m) which was in line
withour 2023/24 guidance.
In order to reach scale at pace and gain
access to a number of key markets, we
haveinvested in freehold and leasehold
sites through organic opportunities as well
as through acquisitions. Now having a recent
period of trading history, we have updated
our cashflow assumptions which has resulted
in an impairment charge of £32m, relating
to seven of our German hotels.
With an encouraging forward booked
position and a clear plan in place, we remain
on track to reach break-even on a run-rate
basis during calendar year 2024 and are
making good progress towards our long-term
target of generating 10%–14% returns on the
£1.1bn of invested and committed capital.
1
Cohort of 17 more established German hotels that
were open and trading under the Premier Inn brand
for 12 consecutive months as at 4 March 2022.
2
In aggregate, adjusted profit before tax excluding
non-site related administration and overhead costs.
Our teams
Our teams are at the heart of our guest
experience, and thanks to their continued
hard work and dedication we are continuing
to deliver the great quality, service and value
that our guests expect from us. Operating
at high levels of occupancy requires that
our team members have to go the extra
mile to deliver for our guests and the fact
that we have been able to improve our
highguest scores over the past year sets
usapart from many of our competitors.
We recognise that the changes we are
making to our F&B offer will be unsettling
for our teams and are committed to working
hard to support all of those affected.
Financial strength
Having a strong balance sheet with
investment grade metrics remains a key
pillar of our capital allocation framework.
The cash generated meant that, even
aftergross capital expenditure of £509m
(2022/23:£546m), £591m of share buy-backs
and £165m of dividend payments during
theyear, our balance sheet remained strong
and we were pleased to receive an upgrade
to our credit rating to BBB (previously BBB-)
3
.
3 Fitch Ratings, 17 August 2023.
Premier Inn Hamburg City Zentrum
CHIEF EXECUTIVE’S REVIEW CONTINUED
Whitbread PLC Annual Report and Accounts 2023/24
10 STRATEGIC REPORT
Clear strategy
Our strategy is focused on driving
long-term, sustainable returns for our
shareholders whilst working with our
stakeholders to ensure we are driving
positive change through our Force for
Goodsustainability programme.
Our vertically integrated model and strong
balance sheet underpin the three pillars of
our business strategy:
• continuing to grow and innovate in the UK;
• focusing on our strengths to grow in
Germany; and
• enhancing our capabilities to support
long-term growth.
The following sections highlight our future
plans that remain central to our long-term
success and will underpin our future
financial performance.
1) Continuing to grow and
innovate in the UK
We are determined to extend our leadership
position as the UK’s number one hotel chain,
driving strong revenue growth and maximising
returns. To achieve these objectives, we
have developed a series of strategic and
commercial initiatives; some of which are
summarised below.
Accelerating Growth Plan (AGP)
Food and beverage (F&B) is a core part of
our guest experience. Over half of our hotel
guests are served by an unbranded integrated
restaurant, which is located inside the hotel
and tailored to the needs of our hotel guests.
We also have a number of hotels where F&B
is provided through a neighbouring branded
restaurant, owned by the Group or a third
party, that sits next to the hotel and is also
open to non-hotel guests.
Whilst our UK hotel performance has gone
from strength-to-strength, the performance
of some of our branded restaurants has
been impacted by a reduction in footfall
from non-hotel guests with the result that
they have struggled to meet their targeted
levels of return. At the same time, a marked
reduction in hotel supply and a shortage
ofdevelopment funding has created an
opportunity to grow our UK rooms pipeline
at a time when many competitors cannot.
As 56% of our UK sites are freeholds, we
arein a position to commence a significant
hotel extensions programme that will grow
our rooms pipeline and generate a high
return on capital.
We have announced our Accelerating
Growth Plan to optimise our F&B offer and
unlock 3,500 new room extensions. This will
enhance the offer for our hotel guests through
the construction of a new integrated
restaurant, increase efficiency and at the
same time, increase our rooms pipeline.
With this plan, together with our existing
committed and future pipeline, we expect
our total open estate to reach at least
97,000 rooms by the end of 2028/29.
Thedetails of our plan are as follows:
1) Over the next 24 months we plan to add
3,500 new rooms to our pipeline through
a new extensions programme. This includes
transforming 112 branded restaurants
into new hotel rooms having first transferred
the delivery of F&B for our hotel guests
at these sites to a more tailored, integrated
restaurant, that will be built inside the
neighbouring hotel, mirroring the
popular format already available at 387
of our hotels. In 2023/24, these branded
restaurants generated revenue of £121m
and a PBT loss
1
of £19m.
2) Over the next 24 months we are
planning to exit 126 branded restaurants;
they will continue to operate as they do
now so that they can be sold as going
concerns. Of these restaurants, we have
agreed to sell 21 for £28m. In 2023/24,
these 126 restaurants in aggregate
generated revenue of £147m and a PBT
loss
1
of £9m. The proceeds from these
disposals will be used to help fund our
investment in building a more tailored,
integrated restaurant at our affected
hotels as well as the construction of new
hotel rooms across the estate.
The majority of our sites, including our
existing 387 integrated restaurants and our
remaining portfolio of 196 higher returning
branded restaurants, will continue to operate
as normal and are not affected in any way.
Our AGP will result in the reduction of
around 1,500 roles out of a total workforce
of 37,000. While these plans are still subject
to consultation, we will seek to find alternative
opportunities wherever possible through
the roles created by this plan and our
existing recruitment process that makes
c.15,000 hires each year. We will be
providing dedicated support to our teams.
Alongside the above plan, we are also
continuing to deploy a series of other
commercial initiatives to help drive our UK
business during 2024/25 including: improving
our trading strategies, broadening our guest
choice and experience, continuing to enhance
our business proposition, making further
improvements in F&B and by investing in
operational excellence.
1 In aggregate adjusted profit before tax
excluding non-site related administration
andoverhead costs.
2) Focus on our strengths
togrow in Germany
We have a clear objective: to become the
number one hotel brand in Germany, replicating
our success in the UK and creating significant
value for our shareholders. With over 10,500
open rooms and a further 6,000 rooms in
our committed pipeline, we are on course
tofulfil this ambition. With our new local
senior leadership team now in place, we are
building strong momentum with several
levers that will have a positive impact on
our performance:
• continued network expansion;
• refining our commercial strategy;
• tailoring our model for our guests; and
• enhancing our business proposition.
3) Enhancing our capabilities
tosupport long-term growth
By continuing to invest in our supporting
infrastructure, we seek to ensure the
smooth execution of our plans, both in
theUK and Germany. Maintaining a strong
balance sheet gives us the confidence to
invest and make long-term decisions that
will enhance our returns.
Asset-backed balance sheet
Our freehold property estate was last
valued at £4.9–£5.8bn in 2018 and it is a
keypoint of difference versus other more
‘asset-light’ business models. Having access
to both freehold and leasehold opportunities
means that we maximise our chances of
securing the assets and locations we want.
We are also able to optimise the size and
format of our estate in order to increase
returns as evidenced by our AGP.
Upgraded technology
Having now completed the multi-year
upgrade to our reservation system and
technology stack across over 900 hotels
across the UK and Germany, we are
continuing to drive further improvements to
our digital networks and systems that will
improve the quality of service to our guests
and drive further efficiency savings.
Lean and agile cost model
As a vertically integrated operator, we are
able to exercise considerable control over
our cost base. Whilst there are signs that
inflationary pressures may be easing, they
remain above average and we have therefore
launched a new cost efficiency programme
to deliver £150m of cost efficiencies over
the next three years. This new programme
will see us extract more savings on a smaller
cost base following the impact of our AGP,
and will be delivered throughout the business.
Whitbread PLC Annual Report and Accounts 2023/24
STRATEGIC REPORT G F O 11
Operating responsibly and sustainably
Being a Force for Good is fundamental to
the sustainable and long-term growth of
our business. Our programme comprises
three core pillars: opportunity, responsibility
and community, and responsible business
practices are integrated into our operations.
Full details of all aspects are set out on pages
56 to 63.
Capital allocation and share
buy-backs
Having now completed £600m of share
buy-backs, the Board has reapplied the
Group’s capital allocation framework. Given
the strength of our financial performance,
our balance sheet and our confidence in the
medium-term outlook, the Board believes
that the Group has sufficient headroom to
recommend an increased final dividend
totalling £115m and intends to conduct an
additional £150m share buy-back, to be
completed during the first half of 2024/25.
Asset-backed balance sheet
and investment-grade status,
BBB rating
2
Maintain
investment-grade metrics
Continue to invest
in profitable growth
Clear dividend policy Capital return
Capital allocation
£550m–£600m gross capex and
expected proceeds from property
transactions of £175m–£225m
Recommended final dividend
of62.9p, resulting in a payment
of£115m
£150m additional buy-back, taking
total shareholder cash returns to
£1bn since April 2023
2024/25 guidance and outlook
In the UK, as evidenced by the market data,
whilst midweek demand has beenrobust,
the phasing of public holidays impacted
weekend demand in certain leisure locations
in the first seven weeks. However, the strength
of our brand and commercial programme
meant that we increased our outperformance
versus the market. We are expecting a
positive step-up in demand across business
and leisure over the next few weeks supported
by our strong forward booked revenue
position which is ahead of last year.
We expect net UK inflation on our £1.72bn
cost base of between 3%–4% in 2024/25,
after £40m–£50m of efficiency savings.
In Germany, our current trading has been
positive with our hotels outperforming the
wider M&E market and we remain on course
to break even on a run-rate basis during
calendar year 2024.
We expect a £20m–£25m reduction in net
finance income versus 2023/24 reflecting
lower cash balances and based on the
outlook for Bank of England rates.
We plan to add 750
–
1,250 rooms in the UK and
c.400 rooms in Germany as we seek to grow
our coverage and scale in both markets.
We expect gross capital expenditure in
2024/25, including our AGP, to be between
£550m–£600m partially offset by proceeds
from property transactions of £175m–£225m
including sale and leasebacks and disposals.
Our AGP plan will require c.£500m of
investment over the next four years which
will be funded through our existing annual
capital expenditure programme.
The changes we have outlined are expected
to result in a one-off reduction to UK adjusted
PBT in 2024/25 of between £20m–£25m, as
wetransition the selected sites to the new
integrated format. Thereafter, with the removal
of these restaurants, the one-off adjusted
PBT impact in 2024/25 will be fully
recovered in 2025/26 and by 2026/27, as
further restaurants
are sold and the addition
of new high-returning
hotel rooms starts to
come through, we expect the plan to deliver
a net incremental
adjusted PBT benefit of
between £30m–£40m.
As the new
extensions mature, we expect further
improvement in subsequent years will
deliver an uplift to adjusted PBT of between
£80m–£90m per annum, driving increased
margins and returns.
At this time the Group expects to incur further
net impairment charges and write-downs
within adjusting items totalling between
£80m and £100m over the next three
financial years. The Group also expects to
incur future cash costs presented within this
adjusting item across the next three financial
years totalling between £20m and £25m.
Delivering a step-change
inmargins and returns
We remain confident about the Group’s
medium-term prospects. We are the clear
market leader in the UK and have a number
of strategic and commercial initiatives, that
will strengthen our position further. In Germany,
we are building a business of real scale and
remain on course to become the number
one hotel brand achieving our long-term
target of 10%–14% return on capital. Together,
with our new efficiency programme, these
initiatives will deliver a step change in our
profitability, margins andreturns.
Dominic Paul
Chief Executive
29 April 2024
2 Fitch Ratings, 17 August 2023.
Whitbread PLC Annual Report and Accounts 2023/24
12 STRATEGIC REPORT
on our
guest proposition
STRATEGY IN ACTION: GUEST PROPOSITION
Whitbread PLC Annual Report and Accounts 2023/24
STRATEGIC REPORT G F O 13
New ground
floorformat
Our hotels offer more than just a place
tosleep and we know how important a
great communal space is to our guests,
either as a place to work or to relax.
Our all-new integrated ground floor concept, ‘The Social’,
offers an enhanced modern and vibrant environment
where guests can check in, choose to order food and
drinks throughout the day at one of our new ‘hero bars’,
or relax in a comfortable lounge area. The improved
layout also allows our teams to multi-task, improving
ouroperational efficiency and helping to reduce costs.
Currently available in four of our UK hotels, we are
planning to extend the trial to further sites over the
coming year.
Increase in F&B spend per sleeper
+£2.60
Source: Company data
Enhanced
standard rooms
We believe that choosing a budget hotel
brand shouldn’t mean our guests have
tocompromise on comfort andquality.
Our latest room format (ID5) offers a ‘home away from
home’ experience for our guests at an attractive price.
Whilst ensuring a great night’s sleep remains our main
focus, we have complemented this with modern artwork,
a walk-in shower and in-room technology. Following
positive customer feedback and higher guest scores, we
are now rolling out the new ID5 format in the UK and
Germany. The improved design and layout will also help
to reduce cleaning time, creating operational efficiencies.
Increase in overall guest scores
+15%pts
Source: Company data
BUSINESS MODEL
F
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Whitbread PLC Annual Report and Accounts 2023/24
14 STRATEGIC REPORT
integratedintegrated
Whitbread owns Premier Inn, the UK’s
leading hotel brand that also has an
expanding presence in Germany. Our
purpose is to provide our guests with
high-quality, affordable hotel rooms
whilst ensuring we offer meaningful
skills and career development
opportunities to our teams.
Our vertically integrated model
differentiates us from our peers and
means that we have full control over
the delivery of our product, driving
growth and long-term value for
ourstakeholders.
Vertically
integrated
model
Culture and
values
Trusted
brand
Leading Guest
Proposition
Engaged
Teams
Profitable
Growth
Shareholder
Returns
Our
approach
F
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Whitbread PLC Annual Report and Accounts 2023/24
STRATEGIC REPORT G F O 15
More about our model
Guest focused
We are passionate about
delivering for our guests and are
continuously evolving our product,
ensuring we can continue to
meettheir needs at an affordable
price.Our annual maintenance
programme ensures every hotel
room meets the high brand
standards that our guests expect.
National network
With over 850 hotels open in
theUK we are well placed to
meet the needs of our guests,
wherever they might need to
stay. In Germany, we now have
hotels in most major towns and
cities and remain one of the
country’s fastest-growing
hotelchains.
Consistent value andquality
Premier Inn continues to bethe
UK’s leading hotel brand and is
delivering high guest scores in
Germany. The investment in
bothourproduct and our
teams,whilst driving material
cost efficiencies, allows us to
continue to offer a consistent,
high-quality and great-value
proposition.
Tailored F&B
F&B is a key pillar of the Premier
Inn guest experience, particularly
breakfast, increasing occupancy
and driving incremental RevPAR.
Our F&B formats vary by location
to ensure we have the optimal
offering to meet our guests’ needs.
Trusted brand
Genuine
Really caring about
our customers
andteams
Confident
Striving to be the
bestatwhat we do
Committed
Working hard for
eachother
Flexible property model
Our significant freehold
estateand flexible approach
toproperty ownership means
wecan both secure hotels in
theright locations and optimise
our network through M&A and
extensions, helping us to generate
attractive long-term returns.
Low-cost distribution
The majority of our bookings
aremade direct, providing
uswith complete ownership
ofthecustomer relationship
andminimising our customer
acquisition costs. It also
enablesour automated trading
engine to optimise our pricing
strategies to maximise revenue.
End-to-end control
By owning and operating all of
our hotels, we control all elements
of the value chain, ensuring the
consistent delivery of a high-quality
product. This also means we
caninvest in developing our
proposition to better meet the
needs of our guests.
Cost efficiency
The breadth and ownership of our
operations mean we benefit from
significant economies of scale.
Wehave an embedded culture of
driving material cost efficiencies,
helping to mitigate inflationary
pressures whilst delivering
attractive operating margins.
Culture and values
Vertically integrated model
Opportunity
Supporting all of our people to reach their potential
withno barriers to entry and no limits to ambition
Community
Making a meaningful contribution to the customers
andcommunities we serve
Responsibility
Always operating in a way that respects people
andtheplanet
Force for Good
See page 61 See page 62 See page 63
Whitbread PLC Annual Report and Accounts 2023/24
16 STRATEGIC REPORT
O
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STRATEGY AND KPIs
How we are
building on
ouradvantage
“ We made excellent progress against our strategic
objectives in 2023/24 across all three pillars
of our strategy. We are continuing to move
forwards at pace and willexecute our plans to
deliver long-term growth and attractive levels
ofreturn.”
Dominic Paul
Chief Executive
Grow and innovate in the UK
Market share gains
2023/24: Remained ahead of the UK M&E sector,
withaccommodation sales 3.1pp ahead and a RevPAR
premium of £5.95 (2022/23:£4.96)
2024/25: Extend our market-leading position as the
UK’s number one hotel brand and reach at least
97,000 open rooms by 2028/29
Strong growth in profits and returns
2023/24: Outstanding trading performance, with
record levels of profit and returns
2024/25: Execute our Accelerating Growth Plan and
deliver cost efficiencies to increase long-term returns
Expand consumer choice
2023/24: Introduced our latest room concept (ID5),
aswell as new bar formats in our hotels including
ourlatest integrated ground floor (IGF) concept
2024/25: Continue to increase the number of Premier
Plus and twin rooms across ourestate
Maintain excellent guest scores
2023/24: Retained our ‘Best Value Hotel Chain’ ranking
from YouGov reflecting our focus on quality and value
2024/25: Continued roll-out of our latest standard
room format, ID5, with a further 5,000 rooms planned
KPI Key
FY24
Result
FY24
Target
Revenue growth
10.4% 8.5%
New rooms
2,253 1,750
Pipeline room additions
1,957 1,000
Community
We partnered with Hope and
Aid Direct – a humanitarian aid
charity – delivering up to 2,000
mattresses in support of those
affected by ongoing
humanitarian crises
Opportunity
In Germany, we launched
ourbespoke leadership
development programme to
foster our in-house talent and
prepare junior hotel managers
for success
Responsibility
In October 2023, we opened
our first all-electric hotel in
Swindon, the first of a new
generation of Premier Inn
hotels that will operate with
100% renewable energy
Aligning with our
strategic priorities
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w
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G
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m
a
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Force for
Good
These KPI tables have been
designed so as to provide greater
transparency for shareholders.
Find out more about Force for
Good on pages 61 to 63
Alignment with remuneration:
Strategic objective Incentivised measure Profit measure
Whitbread PLC Annual Report and Accounts 2023/24
STRATEGIC REPORT G F O 17
Principal risks
Our success in delivering against our strategic objectives is
underpinned by our ability to identify, manage and mitigate
risk within our business. Our principal risks are:
1
Uncertain economic outlook leads to changeable
hotel demand and inflationary cost pressures.
2
Cyber attacks and data breaches resulting in
operational disruption and loss of income.
3
Failure to deliver strategic business and
technology-led change projects.
4
Inability to execute our strategy in Germany
impacting profitability growth.
5
Increased and extended focus on food and
beverageproposition.
6
Extended stagnation of the UK property market
slowing UK growth.
7
Changes in the macro labour market and organisational
structure impacting talent, attraction, and retention.
8
Business interruption within our supply chain and
third-party arrangements.
9
Change in brand-led customer demand and threat
from disruptors impacting brand strength.
10
Adverse publicity and brand damage due to death
orserious injury.
11
Uncertainty associated with the collective environmental,
social and governance risks including climate change.
Find out more on pages 66 to 71
Focus on our strengths to grow
inGermany
Continue to build a national network
2023/24: 59 open hotels across most major locations,
with eight new sites opened during the year
2024/25: Increase our density of coverage in new and
existing catchments
Build brand awareness
2023/24: Maintained our brand awareness score of 14%
2024/25: Continue to assess commercial viability of
using online travel agents as an additional distribution
channel and launch our first online brandcampaign
Use our property expertise to maximise returns
2023/24: Opened three freeholds and five leaseholds
during the year, with 34 hotels in our committed pipeline
2024/25: Continue to take a flexible approach to
property, looking for attractive opportunities to grow
our pipeline
Refine our proposition for the German guest
2023/24: Introduced new payment methodologies, flexible
pricing and recently appointed local leadership team
2024/25: Continue to roll-out additional payment
methods and Premier Plus rooms
Enhance our capabilities to support
long-term growth
Use our strong balance sheet to fund growth
and returns
2023/24: Significant operating cash flow funded
ourongoing investment programme and £756m
shareholder cash returns
2024/25: Continue to apply our rigorous capital
appraisal framework; execute a further £150m
sharebuy-back
Retention and engagement of teams
2023/24: Fully embedded our People plan across all
of our teams, with four key areas: find, keep, grow
andreward
2024/25: Launch our refreshed values to teams
across the business to drive retention and engagement
Improve technology capability
2023/24: Completed the roll-out of our new
reservation system to all of our UK and German hotels
2024/25: Utilise our new reservation system to
improve the digital guest journey and unlock
additional revenue streams
Build on our efficiency programme
2023/24: Delivered £50m of cost efficiencies in 2023/24
2024/25: Begin to deliver our new cost efficiency
programme of £150m savings over the next three years
KPI Key
FY24
Result
FY24
Target
Germany adjusted loss
before tax
£(36)m £(35)m
New and converted rooms
1,923 1,850
Pipeline room additions
1,311 575
KPI Key
FY24
Result
FY24
Target
Whitbread adjusted profit
before tax
£561m £462m
Everyday efficiency
£50m £40m
Water reduction
3.6% 2.6%
Alignment with remuneration:
Strategic objective Incentivised measure Profit measure
Whitbread PLC Annual Report and Accounts 2023/24
18 STRATEGIC REPORT
STAKEHOLDER ENGAGEMENT
BuildingBuilding
long-term
sustainable success
for everyone
“Maintaining and developing positive
relations with all the stakeholders
who may be impacted by the
decisions we make is a critical factor
in ensuring long-term sustainable
success for our business.”
Clare Thomas
General Counsel and Company Secretary
Whitbread PLC Annual Report and Accounts 2023/24
STRATEGIC REPORT G F O 19
Section 172 statement
Stakeholder engagement is
central to the formulation
and delivery of our strategy.
As the strategy for the Group
is developed, the views and
interests of various stakeholders
are factored into the strategic
priorities, including the views
of customers, employees,
shareholders and suppliers.
Equally, the impact of strategy
on the communities in which
we
operate, and on the environment,
is considered. That way, the
strategy is developed directly
with those interests in mind.
The interests of all relevant stakeholders are
carefully considered by the Board and the
Executive Committee as and when specific
decisions are made throughout the year. In
its decision-making, the Board considers
what is most likely to promote the success
of the Company for its stakeholders in the
long-term in a sustainable manner.
Our directors understand the importance of
their section 172 duty to act in good faith to
promote the success of the Company.
As part of the monthly KPI pack, the Board
considers data relating to customer feedback
and team retention, as well as data on
shareholders and themes from investor
relations meetings.
The Chief Financial Officer’s report includes
details on recent engagement with shareholders
and pension trustees discussions and
qualitative feedback on specific concerns.
The Chief People Officer’s report provides
details of all relevant employee-related
matters, including recruitment, retention,
diversity and inclusion, listening, wellbeing,
training and reward.
The General Counsel’s report contains an
update on key developments on the Force
for Good agenda, including work in the
community, charitable fundraising, the
environment, plastics and food waste.
Italso includes best-practice guidance
ongovernance.
The Chief Executive’s report gives details
ofany relevant interaction with Government
or regulators, and key issues with suppliers
and landlords.
Board debate on possible mergers
andacquisitions includes wider impact
assessments, considering issues such
asintegration with the current business,
management capabilities, the impact
onteam members and our supply chain.
The Board also takes into consideration
thelong-term consequences for both the
Company and its stakeholders when making
these decisions, making sure the Company
conducts its business in a fair way, protecting
its reputation and external relationships.
• The Board is supported by the
Company Secretary who is
present at every Board meeting.
The Board also has access to the
advice of the Company Secretary
on governance matters all
yearround.
• The Board also has access to
external advisers should it need
their advice on specific matters.
• Forward agendas available for
the Board to plan ahead of time
which matters are coming up
throughout the year.
• Detailed Board papers are
circulated a week in advance of
the meeting giving directors time
to consider.
• Annual Board Strategy Day to lay
down the key strategic priorities
for the year.
Board information Resources available
• The composition of the Board is
constantly monitored to ensure
the right balance of skills and
experience is maintained.
• The performance of the Board
is evaluated through annual
Board evaluations carried out
in line with the UK Corporate
Governance Code 2018.
• Decisions and outcomes are
reviewed to ensure intended
outcomes are achieved.
Review
• The Board culture fosters
open discussion and
constructive challenge from
thenon-executivedirectors.
• The Board benefits from the
diverse skills, knowledge and
experience of directors when
making key strategic decisions
and performing its duties under
section 172.
Board decisions
Insightful and well-considered strategic decision making
Whitbread PLC Annual Report and Accounts 2023/24
20 STRATEGIC REPORT
Employees
Our people are the key to our success. A talented,
engagedand diverse workforce is critical to support
ourgrowth ambitions in the UK andGermany.
STAKEHOLDER ENGAGEMENT CONTINUED
Outcomes of engagement
• Over £40m in pay awards across our
hourly and salaried teams in the UK and
Germany, an investment of over £2m
in recognition and trading incentives
for our teams in the UK, and the award
ofover £46m in annual incentive
schemepayments.
• Material reduction of 5pp in team turnover
rates in the UK and high engagement
scores from our employees across both
UK and Germany.
• Achievement of our 2023 diversity
target for 8% ethnic representation
in
our leadership community; longer-term
improvement in our female representation
in leadership to currently stand at 39.8%.
What matters to employees
• A healthy and safe working environment.
• Industry-leading training
anddevelopment.
• Career development opportunities.
• Market-leading reward and
incentivestructures.
• Focus on team member wellbeing.
• A diverse and inclusive culture in
which everyone is welcome and
canbethemselves.
• Open, honest and transparent
management processes.
Board considerations
• Over the year the Board has focused
discussions on team member pay, taking
into consideration the current cost of
living and the impact on our entry level
workers in particular.
• The Board reviews monthly KPI data
regarding team retention.
• The Chief Executive, in his report, outlines
and makes proposals in relation to team
retention and reward strategies.
• ‘Our Voice’, a body made up of
electedrepresentatives across the
business, represents the views of
employee constituencies to senior
management. The Board receives
reportsof these meetings.
• The Board reviews the Speaking Out
process to ensure we have the right
platform for employees toraise concerns.
• The Board has set eight diversity and
inclusion commitments to ensure that
the Group is representative of the
communities in which we operate. Good
progress has been made in relation to
these targets. Read more on page 49.
• Diversity and inclusion is considered as
part of all Board appointments. This is
guided by the Board Diversity Policy,
which was updated in March 2024 and
the Gender and Ethnicity Pay Gap Report
2023. More detail on this can be found
onour website, www.whitbread.co.uk.
• The Board reviewed diversity and
inclusion as part of the succession
planning and people strategy. This also
included focus on creating a diverse
pipeline at the senior management level.
The Board discussed the various diversity
and inclusion networks: GLOW, RRCH,
eNable and GEN.
• In the monthly Chief People Officer’s
report the Board receives detail on all
areas of the people strategy.
• The Board receives reports on health and
safety management bi-annually; statistics
are included in the monthly KPI pack
and any serious incidents are reported
immediately to the Board.