Key facts about the closures:

• Whitbread’s plan includes converting its remaining restaurants into an integrated food and beverage model.
• The company aims to achieve cost savings of £250 million.
• It intends to sell and lease back £1.5 billion worth of freehold properties.
• The Beefeater brand has been part of Whitbread since its establishment in 1974.

Dominic Paul, CEO of Whitbread, stated, “We plan to convert all our remaining branded restaurants to an integrated food and beverage offer that is preferred by our hotel guests.” This move aligns with the company’s goal to transform into a higher-margin, higher-returning pure-play hotel business.

The Unite union has expressed concerns over the manner in which these job cuts were communicated. Colenzo Jarrett-Thorpe criticized the company’s approach: “It is disgraceful that Whitbread employees heard about the job cuts through the media.”

Currently, Whitbread employs around 30,000 people across the UK and Ireland. The company’s revenues for the year ending February remained flat compared to the previous year, while it reported a pre-tax profit of £298 million.

Over the past six months, Whitbread’s shares have fallen by 20%, reflecting investor concerns about its future direction amidst these drastic changes.

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Approximately 12% of Whitbread’s workforce of 30,000 will be affected by these job cuts. The company intends to convert all 197 of its remaining branded restaurants into hotel-based food and drink services, aligning with its focus on the Premier Inn brand.

The restructuring comes as Whitbread faces increased costs due to recent fiscal changes in the UK. The company reported flat revenues for the year ending February 26, compared to the previous year. Furthermore, Whitbread’s shares have fallen 20% over the past six months, indicating financial pressures.

In a bid to enhance profitability, Whitbread plans to sell and lease back £1.5 billion worth of its freehold properties. This strategy aims to cut net capital expenditure by more than £1 billion over the next five years.

The Beefeater brand has been part of Whitbread since its establishment in 1974. However, as consumer preferences shift towards hotel dining experiences, Whitbread is adapting its business model. Dominic Paul, the CEO, stated that they will create an integrated food and beverage offer preferred by hotel guests.

The Unite union has expressed concern over the job cuts, seeking consultations with Whitbread regarding the redundancies. Union representative Colenzo Jarrett-Thorpe criticized the company’s communication, stating it was disgraceful that employees learned about job losses through the media.

This restructuring follows a review initiated in November last year as part of Whitbread’s five-year plan. As it pivots away from casual dining to focus on hotels like Premier Inn, the hospitality sector may see further changes in response to evolving market demands.

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