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Whitbread, the owner of the Premier Inn budget hotel chain, has said that it is delaying a planned cash return to shareholders as a result of the current turbulence on the credit market.

The move comes despite the company announcing stronger first-half sales today. In the 24 weeks to August 16th the group's total sales climbed 11.3 per cent, while like-for-like sales were up 6.6 per cent.

Sales were boosted by the expansion of both the Premier Inn chain and Whitbread's Costa Coffee business.

Like-for-like occupancy at Premier Inn hotels was up 1.3 per cent on the previous year during the first-half, rising to 82.1 per cent. Like-for-like sales for the unit were subsequently up by 11 per cent on the same period in 2006.

Whitbread said Costa's total sales had increased "substantially" year-on-year following new store openings and strong like-for-like sales, which climbed 7.2 per cent. Total sales for the coffee chain were up 23.5 per cent, while the company also celebrated the opening of the 600th UK Costa outlet in Wimbledon this month.

In addition, like-for-like sales across Whitbread's restaurants were also up by two per cent on the previous year. The company, which owns the Beefeater and Brewers Fayre chains, said margins had improved despite prices remaining flat, with the improvement achieved as a result of a reduction in discounts and a better operating performance.

Whitbread, which completed the £925 million sale of its David Lloyd leisure business earlier this month, repeated its intention to initially use the proceeds to pay off debt.

Meanwhile the company announced the start of a share buyback programme as part of plans to increase the group's leverage.

However Whitbread stressed that current market turbulence had dissuaded the group from returning further cash to investors.

"Our plans to issue bonds secured on the hotel and restaurant assets are well advanced," said Whitbread chief executive Alan Parker.

"However, given the current conditions in the debt markets we are considering with our advisers the most appropriate time to proceed," he added.