Whitbread posted a 44% rise in half-year profit on Wednesday helped by strong demand for its Premier Inn hotels and resilient consumer spending at its restaurants.
Shares in the British company, originally a brewer, were up 3.5% to 3,437 pence by 0737 GMT to lead London's blue-chip .FTSE index.
CEO Dominic Paul said the company was not seeing issues with customers due to higher prices, adding 86% of its customers in the first half were repeat visitors.
Leisure and business demand are showing signs of staying, Paul said, adding forward-booked revenue was ahead of last year.
A recovery in international travel following the easing of pandemic restrictions has been further buoyed by a strong pound, as well as flexible work arrangements that have encouraged mini-breaks and longer trips.
Travellers are also opting for established hotel chains over independent properties, some of which have not reopened after the pandemic, Whitbread has noted.
'Selective Site Expansion'
"In the UK, supply is not expected to get back to pre-pandemic levels for at least five years, so there's space for selective site expansion without crushing margin," Hargreaves Lansdown analyst Derren Nathan said.
The company, which operates more than 840 hotels across UK and Germany, said adjusted profit before tax rose to £391 million (€450 million) in the first half from £272 million (€313 million) a year earlier.
Food Inflation Easing
Whitbread, which owns restaurant chains such as Bar+Block Steakhouse and Brewers Fayre has also seen signs of food inflation easing.
The company announced a further £300 million (€345 million) share buyback on Wednesday and proposed an interim dividend per share of 34.1 pence, up 40% on last year.