Premier Inn owner Whitbread has been hit by Brexit uncertainty as it has taken a toll on business travel causing a drop in UK sales.
In the first quarter like-for-like accommodation sales fell by 4.6% and revenue per room dropped by 6.3%.
The group warned that hotel demand in the regional business market has been knocked by Brexit woes and they are seeing rising costs.
For the same period like-for-like sales in London dropped by 4.2% whilst regional business had a 4.7% fall.
Alison Brittain, chief executive of Whitbread said, “We have delivered a resilient performance in the first quarter despite more challenging market conditions and we continue to make good progress with our efficiency programme, which is helping to partially offset another year of high industry cost inflation.”
She added, “Whilst we are cautious about short-term market conditions, we are confident in our plans given the significant growth opportunities in the UK and internationally.”
Richard Hunter, head of markets at interactive investor said, “Without the diversification and success that Costa brought, the company is now mostly hostage to the cyclical hotels market.
“With business confidence under threat from an uncertain economic outlook in the UK, accommodation sales have been weak, particularly in the regions where Premier Inn has a significant presence.
“Meanwhile, cost inflation generally is a worry and the food and beverage part of the business is also under pressure.”