Premier Inn owner Whitbread has slumped to a £1bn annual loss – but hopes to benefit from a “staycation” boom over the summer.

Revenues for the year to 25 February fell 71% to £589m with the group’s hotels and restaurants closed for much of the period while 27,000 workers were furloughed and about one in eight head office staff were axed.

Whitbread has more than 800 Premier Inn hotels in the UK and all but 39 of them – kept open for the use of key workers – were closed as lockdowns took hold.

But the group, which can trace its origins back to the 18th Century when its since-discarded brewery arm was founded, said 92% of its UK hotels were now open.

“Strong demand is expected for ‘staycations’ in UK tourist destinations throughout the summer, with business and event-led leisure demand starting to gradually recover thereafter,” the company said.

Chief executive Alison Brittain said: “The last financial year was one of the most challenging in our 279-year history, as we operated under significant COVID restrictions which had many implications for our businesses, our customers and our people.

“The vaccination programme in the UK means we can look forward to the planned relaxation of government restrictions as we move into summer, with the first major milestone being the return of leisure guests to our hotels, and the full reopening of restaurants from 17 May.

“We expect a significant bounce in leisure demand in our tourist locations during the summer, followed by a gradual recovery in business and event-driven leisure demand.”

The company, which also operates brands including Beefeater and Brewers Fayre in the UK and has a growing presence in Germany through the expansion of the Premier Inn chain, said it planned more than £350m of investment in the current financial year.

Whitbread said it was well-placed to take advantage as rival low-cost and independent hotel operators struggle.

The company’s huge loss included a £348m accounting charge related to its business in Germany as well as a review of the impact of the COVID-19 crisis on current and future growth rates.

Whitbread benefited from £270m-worth of government support including the furlough scheme subsidising wages for temporarily laid-off workers as well as business rates relief.

Shares fell 2% in early trading.

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