Summary report and accounts
Summary directors' report
The full directors' report and full corporate governance report are set out in the Directors' Report and Accounts, which can be found on the Company's website or obtained by writing to the Company's registrar at the address shown here.
Principal activities and review of business
| Results and dividends | |
|---|---|
| Group profit before tax and exceptional items from continuing operations* | £229.9m |
| Group profit before tax and after exceptional items from continuing operations | £198.6m |
| Interim dividend paid on 6 January 2009 | 9.65p per share |
| Recommended final dividend | 26.90p per share |
| Total dividend for the year | 36.55p per share |
* Continuing operations
Continuing operations comprises Whitbread Hotels and Restaurants
and Costa plus the supply chain sales to third parties but excludes
any discontinued businesses (David Lloyd Leisure disposed of during
2007/08).
The principal activity of the Group is the operation of hotels, restaurants and coffee shops. These operations are largely carried out in the UK, although Premier Inn operates one hotel in Ireland and another in Dubai via a joint venture. Costa operates coffee shops in 24 international markets through joint ventures or on a franchise basis. Details of the Group's activities, developments and performance for the year, the main trends and factors likely to affect its future development and performance and information required by the Companies Act 2006 relating to the business review are set out in the Chairman's statement, the Chief Executive's review, the Finance Director's review and the corporate responsibility report and in the section entitled 'risks and uncertainties' on pages 4 and 5 of the Directors' Report and Accounts. Details of the Company's WINcard, containing the key performance indicators can be found here.
Subject to approval at the Annual General Meeting, the final dividend will be payable on 10 July 2009 to shareholders on the register at the close of business on 8 May 2009.
Board of directors
The directors at the date of this report are listed on the Board of directors page of the Annual Review. All except for Patrick Dempsey and Stephen Williams served throughout the year. Patrick Dempsey joined the Board on 1 January 2009. Stephen Williams joined the Board on 27 April 2008 and became Senior Independent Director on 1 October 2008. Rod Kent resigned from the Board on 31 March 2008.
Patrick Dempsey will stand for election and Alan Parker will stand for re-election at the forthcoming AGM in accordance with the Company's Articles of Association.
Details of the directors' service contracts are given in the remuneration report on page 11 of the Directors' Report and Accounts. None of the non-executive directors has a service contract.
Corporate governance
The Company is committed to high standards of corporate governance and, with one exception, complied throughout the year with the provisions set out in Section 1 of the Combined Code on Corporate Governance. The exception related to a period during which the Company did not have a Senior Independent Director, while a successor to Rod Kent was sought. The full corporate governance report can be found on pages 6 to 9 of the Directors' Report and Accounts.
Share capital
Throughout the year, the authorised share capital has been
£319.89 million divided into 410,170,050 ordinary shares
of 
each
(representing 98.47% of the total share capital), 265 million B
non-cumulative preference shares of 1 penny each (representing
0.83% of the total share capital) and 224 million C non-cumulative
preference shares of 1 penny each (representing 0.70% of the total
share capital).
Details of the issued share capital can be found in note 31 to the accounts.
Holders of ordinary shares are entitled to attend and speak at general meetings of the Company, to appoint one or more proxies and, if they are corporations, corporate representatives to attend general meetings and to exercise voting rights. Holders of ordinary shares may receive a dividend and on a liquidation may share in the assets of the Company. Holders of ordinary shares are entitled to receive the Company's annual report and accounts. Subject to meeting certain thresholds, holders of ordinary shares may requisition a general meeting of the Company or the proposal of resolutions at annual general meetings.
Major interests
| No. of shares | % of issued share capital | |
|---|---|---|
| Legal & General | 11,985,398 | 6.75% |
| Schroders | 10,531,421 | 5.35% |
| Black Rock | 8,727,235 | 5.00% |
| AXA | 8,675,788 | 4.97% |
| Standard Life Investments | 7,894,946 | 4.53% |
As at 24 April 2009, the Company had been notified of the following interests of 3% or more (see table on right) of the voting rights of the Company pursuant of Rule 5 of the Disclosure and Transparency Rules.
Charitable and political donations
No direct charitable donations have been made by the Company. The Whitbread Charitable Trust made donations totalling £249,762 during the year. Costa Limited, a subsidiary of the Company, made a direct donation of £150,000 to the Costa Foundation. Further details about the Costa Foundation.
The Company has not made any political donations during the year and intends to continue its policy of not doing so for the foreseeable future.
Employment policies
Whitbread has a range of employment policies covering such issues as diversity, employee well-being and equal opportunities.
The Company takes its responsibilities to the disabled seriously and seeks not to discriminate against current or prospective employees because of any disability. Employees who become disabled during their career at Whitbread will be retained in employment wherever possible and given help with rehabilitation and training.
Employee involvement
The importance of good relations and communications with employees is fundamental to the continued success of our business. Each of the Group's operating businesses maintains employee relations and consults employees as appropriate to its own particular needs. Regular internal communications are made to all employees to ensure that they are kept well informed of the performance of the Group.
Purchase of own shares
The Company is authorised to purchase its own shares in the market. Approval to renew this authority for a further year will be sought from shareholders at the 2009 AGM.
In total 1.6 million ordinary shares of each
(representing 0.85% of the total called up share capital at the
beginning of the year) were acquired during the year at a cost of
£20.0 million. Five million of the shares held in treasury
(representing 2.58% of the total called up share capital at the
beginning of the year) were cancelled during the year. 14.8 million
shares (representing 7.61% of the total called up share capital at
the beginning of the year) are held as treasury shares. The maximum
number of ordinary shares held in treasury during the year ended 26
February 2009 was 19,188,806 on 27 June 2008 (representing 9.89% of
the total called up share capital at that time).
At the 2008 AGM the Company was authorised to purchase its C shares pursuant to a proposed contract between Deutsche Bank AG, London Branch and the Company. In total, 2.7 million C shares of 1 penny each, representing 0.02% of the total called up share capital at the beginning of the year, were acquired during the year at a cost of £4.4 million, as part of the strategy to return value to shareholders. All of these shares have now been cancelled.
Auditor
Ernst & Young LLP have expressed their willingness to continue in office as auditor of the Company and a resolution proposing their reappointment will be put to shareholders at the AGM. After proper consideration, the Audit Committee is satisfied that the Company's auditor, Ernst & Young LLP, continue to be objective and independent of the Company. In coming to this conclusion, the Audit Committee gave full consideration to the non-audit work carried out by Ernst & Young LLP.
The Audit Committee has considered what work should not be carried out by the external auditor and have concluded that certain services, including internal audit, acquisition due diligence and IT consulting services, will not be carried out by Ernst & Young LLP.
Disclosure of information to auditor
The directors have taken all reasonable steps to make themselves aware of relevant audit information and to establish that the auditor is aware of that information. The directors are not aware of any relevant audit information which has not been disclosed to the auditor.
Going concern
After making enquiries, the directors have a reasonable expectation that the Company and the Group have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the annual report and accounts.
Annual General Meeting
The AGM will be held at 2.00pm on 16 June 2009 at the Queen Elizabeth II Conference Centre, Broad Sanctuary, Westminster, London SW1P 3EE. The notice of meeting is enclosed with this report for those shareholders receiving hard copy documents, and available at www.whitbread.co.uk for those who elected to receive documents electronically.
By order of the Board.
Simon Barratt
General Counsel and Company Secretary
27 April 2009
Registered Office:
Whitbread Court
Houghton Hall Business Park
Porz Avenue
Dunstable
Bedfordshire
LU5 5XE
Registered in England: No. 4120344
The Annual review and summary report 2008/09 and the Directors' Report and Accounts contain certain statements about the future outlook for the Group. Although the Company believes that the expectations are based on reasonable assumptions, any statements about future outlook may be influenced by factors that could cause actual outcomes and results to be materially different.