Whitbread has seen its share price fall by almost 10% after its pre-tax profit dropped by 7% to £316m in the six months to 28 August.

The Premier Inn owner said that this figure reflects flat UK total accommodation sales and positive momentum, which was offset by anticipated food and beverage sales due to the continued implementation of its accelerating growth plan (AGP).

The firm also saw its revenue fall by 2% in this period to £1.54bn, while its adjusted earnings per share fell by 2% to 133.7 pence.

In its interim results, Whitbread said that its five-year plan to deliver profit before tax of at least £300m by 2030 is on track, with its AGP replacing over 200 lower-returning branded restaurants with an integrated food and beverage offering.

Chief executive at Whitbread, Dominic Paul, said: "In the UK, with a return to market growth, we sustained our outperformance versus the market through the strength of our guest proposition and commercial programme. We are making strong progress on our AGP which, together with our committed pipeline of both Premier Inn and 'hub by Premier Inn' rooms, means we remain on track to reach at least 98,000 open rooms by FY30, extending our position as the clear market leader.

"We remain focused on disciplined capital allocation and increasing financial returns. Having completed £99m of sale and leasebacks at attractive yields and with the updated valuation of our estate, we are on track to recycle £1bn by FY30 to fund future high-returning growth, such as our AGP, and increase our return on capital employed."

Looking ahead, Whitbread said that it remains confident in its outlook for the full year, despite some uncertainty around the upcoming Autumn Budget.

The firm has also updated its guidance for the full-year, adding that higher than expected cost inflation will be partially mitigated by increased cost efficiencies of between £65m to £70m, from a previous guidance of £60m.

Investment director at AJ Bell, Russ Mould, concluded: "Whitbread shareholders will be wondering if Premier Inn’s ‘good night sleep or your money back’ guarantee extends to investors, judging by yet another weak performance.

"Earnings in reverse, higher net debt, and a downgrade to forward profit guidance is the kind of news that makes investors suffer from insomnia. The fact Premier Inn is struggling to make decent progress in the UK suggests market conditions remain unfavourable for the hospitality industry.

"There are reasons not to lose hope. Trading has picked up recently in both the UK and Germany, and the group continues to take market share. Unfortunately for the company, the negative share price reaction to its latest results suggests investors lack faith in Whitbread bouncing back any time soon."

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