Whitbread to stick to London hotel growth plan despite slowdown

By Rahul B (Reuters) - The head of Whitbread Plc , the owner of Premier Inn hotels and the Costa Coffee chain, said the company would stick to its plans to expand in the London hotels market despite reporting a slowdown there. The FTSE 100 company posted an 8.6 percent rise in sales for the three months to the start of December as underlying business at its Costa Coffee chain strengthened but weakness at Premier Inn weighed, sending its shares as much as 6 percent lower. The company has opened 15 hotels in Britain since the start of year, of which five were in London. Total revenue per available room -- the hotel industry's preferred measure -- fell 6 percent for the third quarter for its London hotels. However, Chief Executive Alison Brittain said the British capital remained a priority. "We have a lower market share in London, so we would like to grow more in London," Brittain told Reuters. "London hotels mature more rapidly against the regional ones, which take 3-4 year to mature but London hotels take a year or so," she added. The company plans to have a total of 18—20,000 rooms in London by 2020, according to its latest annual report, an increase from a current figure of 11,500. It had blamed subdued corporate demand for the shortfall in London when it reported interim results in October.. Luxury hotel group Millennium & Copthorne also echoed this concern. [nL8N1D32GB] Coffee sales were perkier and Brittain reassured investors that the group's annual figures should meet forecasts. "Trading since the end of the quarter is such that we expect to deliver full year results in line with expectations," she said. Like-for-like sales at high street coffee chain Costa grew 4.3 percent in the 13 weeks to Dec. 1, up from a 2 percent rise in the 13 weeks to the start of September. The company said in October it was trying new blends and fresh food options to woo back the discerning coffee drinkers in a highly competitive area. "We are looking at projects to roll out more successful elements of those trial to our full estate," Brittain said. Under Brittain, who took over in September 2015, the company faces a tough task of keeping costs tight as it looks expand internationally. In Germany it has opened a Premier Inn hotel in Frankfurt and plans to add two more in Munich and Leipzig by 2018. (Reporting by Rahul B in Bengaluru; Editing by Susan Thomas/Keith Weir)