Whitbread, the hospitality company that owns Premier Inn and Costa Coffee, saw net debt rise to £909.8 million ($1.3 billion) from £583.2 million in the year up to 3 March.
In its annual report, released on Tuesday, Whitbread said that this growth in debt was down to increased capital expenditure, but it reassured investors that it has “sufficient facilities to finance short and medium-term requirements with total committed facilities of £1.7 billion.”
While debts grew substantially, Whitbread was also able to boosts sales, with like-for-like growth up 3%. Total revenue over the year was £2.9 billion.
On a company by company basis, Premier Inn enjoyed like-for-like sales growth of 4.2%, while Costa’s like-for-like sales grew 2.9%.
The results are the first under the tenure of Whitbread’s new CEO Alison Brittain, who took over in September last year. She used the results as an opportunity to outline her plan for the group:
“I have identified three key strategic themes to develop our business: grow and innovate in our core UK businesses; focus on our strengths to grow internationally; and build the capability and infrastructure to support long-term growth. This strategy will enable us to deliver our significant growth ambitions, grow earnings and dividends, maintain good returns on capital and create further value for our shareholders.”
Investors have so far responded well to Whitbread’s annual report. Shares are among the biggest gainers on the FTSE 100 so far today, jumping 2.59% as of 9:45 a.m. BST (4:45 a.m. ET). A single share in Whitbread is currently worth £39.67. Here’s how shares look this morning:
Business Insider has reached out to Whitbread for more information about its growing debts, and will update this post when we hear back.