Nothing is for sale at Whitbread, according to chief executive Alan Parker, even though only the budget hotel Premier Travel Inn is trading well out of the group's main divisions.
Parker argues that far from being a break-up situation, Whitbread is driving operational performance.
But both its pub restaurants and its high street restaurants showed negative like-for-like sales in the 50 weeks to February 16. Pub restaurants were down 2.0% and high street restaurants were down 3.7%.
The company admitted that the performance at the pub restaurants division 'continues to disappoint' but it said it was encouraged by a consistent year-on-year covers growth thanks to a new pricing strategy at Beefeater.
A new menu is also being rolled out over the next two months across the Brewers Fayre estate offering better value meal deals.
But TGI Friday's and Pizza Hut \continue to find conditions in the high street difficult\, said the company.
Premier Travel Inn, is, meanwhile, shooting ahead. The chain reached its 30,000 room milestone with the opening of the Hammersmith Premier Travel Inn in London last week. This was a conversion from a former Best Western hotel and Parker said such conversion could be 'a rich seam' for the chain going forward.
Whitbread has stepped-up its expansion plans for PTI and has set a new goal of reaching 45,000 rooms in the UK by the end of 2010, a 50% increase on current levels.
The diverging performances across Whitbread's trading divisions has only fuelled speculation that the company will sell-off further bits, despite Parker's comments.
A favourite for the chop is the David Lloyd health club chain. But Parker said: \We are very encouraged with the results of David Lloyd. We are building value and profitability for the benefit of our shareholders.\
During the 50 weeks, like-for-likes at David Lloyd were down 0.6% but the new management team has increased new member sales by 20% in the months of December and January.
City analysts have pencilled-in a break-up value for the group since speculation started last summer. Whitbread's shares are still trading below these values but have picked-up 30% from last May's low point.
The break-up pressure will only intensify unless the weaker divisions are turned around during the course of this year, it is believed.
A bid for Travelodge, the number two budget hotel chain in the UK, may yet prove the decisive factor even though Parker was cagey about the prospects. He said the company would be unwilling to overpay for worn-out assets.
The 'not overpaying' line was also used during the auction for the Premier Lodge business sold by Spirit. Whitbread agreed to pay £505m for the chain of 132 hotels in July 2004. The EV / EBITDA ratio on that deal was nearly 14 times, regarded as a full price by most commentators.