Whitbread, the business priced for the credit crunch before the term was invented, today showed that its cut-price offerings are still luring punters.

The hotels, restaurants and coffee shop group saw sales in the past six months up 12.6% to £682 million. Like-for-like sales are still rising at a pace 7% taking profits up 24% to £123 million.

Chief executive Alan Parker slimmed down the sprawling business under pressure from private equity, offloading assets such as the David Lloyd Leisure clubs well before the downturn.

With consumers looking to cut costs, the Premier Inn budget hotel arm has been particularly successful, while Costa Coffee is booming.

On the face of it, Costa Coffee appears to be the brand most vulnerable to the slumping economy, though there were no signs fans were cutting back.

There is less traffic on the High Street in general, but Costa is opening in motorway service stations and airports. It now has 800 stores in the UK.

The Beefeater restaurants chain has been problematic, but showed signs of recovery today, with an 8.4% rise in sales.

Parker said: "Consumers have had a really tough time and it is going to be challenging...but we offer value for money, and in that sense the market is moving in our direction."

Parker insists Costa remains "an everyday affordable treat" rather than an obvious area for consumers to pinch pennies.

Whitbread's balance sheet was clobbered by the addition of another £156 billion of debt in the past six months to fund the expansion plans. At £581 million, the debts are still well short of the available £1.1 billion.

Despite rising profits, the shares have still tumbled. They are down from a year-high of 1774p, but added 48½p to 1018p this morning.

Beleaguered property tycoon Robert Tchenguiz is understood to have cashed in his £50 million stake in Whitbread, as well as exiting Sainsbury's and pubs group Mitchells & Butlers.

Premier Inn has seen sales rise more than 10%, as travelling salesmen and other business people try to cut costs.

The interim dividend is lifted 6% to 9.65p.