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Premier Inn owner Whitbread confirms 1,500 jobs axed amid sales plunge

The group had warned last year that 6,000 roles may go, but said more workers than expected agreed to reduce their hours.

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Premier Inn owner Whitbread said sales across its hotels and restaurants have more than halved as coronavirus restrictions forced swathes of its estate to close (Lewis Whyld/PA)

Premier Inn owner Whitbread said sales across its hotels and restaurants have more than halved as coronavirus restrictions forced swathes of its estate to close (Lewis Whyld/PA)

Premier Inn owner Whitbread said sales across its hotels and restaurants have more than halved as coronavirus restrictions forced swathes of its estate to close (Lewis Whyld/PA)

Premier Inn owner Whitbread has confirmed it axed around 1,500 jobs as it saw sales more than halve after coronavirus restrictions forced swathes of its estate to close.

The group, which also owns chains including Beefeater and Brewers Fayre, said the redundancies were far fewer than the 6,000 initially feared thanks to more workers than expected agreeing to reduce their hours.

It does not expect to make any more job cuts in the near future.

Whitbread saw like-for-like UK accommodation sales tumble 56% in the 13 weeks to November 26, while food and drinks sales plunged by 54.4%.

But it said accommodation sales slumped as much as 66.4% in the five weeks to December 31 as restrictions tightened, with total UK sales down 73.4%.

In the UK, around two-thirds of its hotels are open for essential business and key worker accommodation, while all restaurants are shut.

We look forward to the potential gradual relaxation of restrictions from the spring, business and leisure confidence returning, and our market recovering over the rest of the yearAlison Brittain

Chief executive Alison Brittain called on the Government to extend the business rates relief and temporary VAT reduction as she said the group was braced for restrictions to remain in place in some form until after Easter.

She said a move to extend the relief would be a “good policy decision for the Government, because hospitality does have the opportunity to bounce back and help the economy recover as and when we come out of this pandemic”.

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Chief executive Alison Brittain said Whitbread expects the current travel restrictions in the UK and Germany to remain until at least the end of the group’s financial year (Whitbread/PA)

Chief executive Alison Brittain said Whitbread expects the current travel restrictions in the UK and Germany to remain until at least the end of the group’s financial year (Whitbread/PA)

PA

Chief executive Alison Brittain said Whitbread expects the current travel restrictions in the UK and Germany to remain until at least the end of the group’s financial year (Whitbread/PA)

Ms Brittain said the group was financially strong, having completed a rights issue last year, and having been boosted by government measures totalling around a third of its annual £700 million a year tax bill.

She said: “We expect the current travel restrictions in the UK and Germany to remain until at the very least the end of our financial year.

“With the vaccination programme under way, we look forward to the potential gradual relaxation of restrictions from the spring, business and leisure confidence returning, and our market recovering over the rest of the year.”

The update showed the group saw relatively strong demand in September, with hotel occupancy at 58%, which continued through October, before paring back sharply to 35% in November during the second English lockdown.

It added that it will continue to expand its operations in Germany, but warned that with Covid-19 restrictions hammering sales, it now expects the division to be loss-making into 2022-23.

Shares lifted 4% on Thursday morning despite the sales hit.

William Ryder, equity analyst at Hargreaves Lansdown, said: “This hasn’t been a good year for hotels, and the last quarter has seen things deteriorate again for Whitbread.

“Occupancy rates had recovered to 58% in September, but the November lockdown and progressively tightening restrictions in December saw occupancy collapse.

“Now that the nation is back in a full-on lockdown, Whitbread’s looking at another tough few weeks, and probably longer.”

PA


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