Shares in Whitbread were down on the FTSE 100 in morning trading as "market malaise" offset a strong rise in sales reported for the half year ended 19 August.
Total group sales were up 14 per cent from the previous year, while group like for like sales increased 7.9 per cent.
Total sales at Whitbread's Premier Inn chain increased 14.5 per cent, while like for like sales rose 10.7 per cent. Whitbread's restaurants saw total sales climb 4.3 per cent and like for like sales increase 3.9 per cent.
At its Costa coffee business Whitbread saw total sales jump 28 per cent and like for like sales rise 8.3 per cent. At its Hotels and Restaurants business total sales increased 10.1 per cent and like for like sales rose 7.8 per cent.
Alan Parker, Chief Executive of Whitbread PLC said, "This strong performance across Whitbread is the result of our strategy to increase market share through organic expansion and driving like for like sales. We will continue to make progress in this "age of austerity" by relentlessly focusing on meeting the needs of our customers. Whitbread is well placed, with the right brands offering value for money in attractive segments of the market which have significant opportunities for future growth. We remain confident about the outturn for the year, despite facing tougher comparatives in the second half."
Richard Hunter, Head of UK Equities at Hargreaves Lansdown Stockbrokers, commented, "The shares have fallen foul of a wider market malaise despite reporting an extremely robust update.
"The progress at Costa Coffee and, in particular, Premier Inns, continues apace as the company's value offerings appeal to the cost conscious consumer. In addition, the accompanying comments are upbeat as management has identified significant possibilities for further growth. Whitbread has continued to deliver leading up to and entering the expected age of austerity, whilst its dynamic price initiatives leave it well placed for any future downturn. The restaurant businesses, whilst overshadowed by the larger brand names, have also made a contribution to the overall picture, such that the company is truly firing on all cylinders.
"The share price performance has factored in some of this strong growth, having risen 47% over the last year, during which time the wider FTSE100 has added 9%. Nonetheless, the prospects remain bright and the current market view is that the shares are a strong buy."
By 10:40 shares in Whitbread were down 0.40 per cent on the FTSE 100 to 1,506.00 pence per share.