...Leading UK Hospitality Business: The rating reflects Whitbread PLC's leading position in the less cyclical budget segment of the UK hospitality sector, with its Premier Inn brand. It benefits from a well-invested estate and business customers choosing less expensive hotels. About 76% of the group's operating profit is generated by hotels and restaurants, and 24% by Costa Coffee. The rating also reflects Whitbread's lack of geographical diversification outside the UK. Resilient Performance: Whitbread continues to perform well. Like-for-like sales grew by 4.2% in the financial year to February 2014 (FY14) driven by its strong brands, with an increase in underlying pre-tax profits of 16.5%. Fitch Ratings expects operating performance to be positive in FY15, thanks to the group's hotel expansion strategy in the UK and Costa's strong growth and profit momentum in a developing sector. Stabilising Pension Deficit: The rating captures the high annual cash contributions needed to reduce the pension...
