Attacks force M&C to slash 500 jobs

Millennium & Copthorne has axed 500 jobs since the end of September as a result of the attacks on the USA.

The company said last week that it was still implementing "a number of vigorous cost-saving initiatives".

The group has shifted full-time staff to part-time working arrangements in Asia and has put workers on a four-day week. It has also encouraged staff to use annual leave and introduced shorter working hours.

Chief executive John Wilson said most job losses were in the USA and London. In London most losses were administrative positions at the group's corporate and head offices.

Wilson said laying people off was "a very sorry thing to have to do", but there was no other way he would be able to make the necessary savings.

He added that the group would not be spending "anything other than what is essential".

Wilson confirmed that the group had been forced to close floors in some of its US hotels, but would not be doing so in the UK. No hotel closures are planned.

M&C warned that profits would be "substantially lower than those achieved in the first six months" of the year.

Business is particularly bad for the group in the USA, where M&C runs 22 hotels. The group has four hotels in New York, which contribute the majority of its US profits.

In the 16 days ended 30 September, turnover for the US hotels fell by 61% compared with the same period last year. In the first three weeks of October turnover was down 39%.

Turnover in the group's London hotels was down by about 29% in the 16 days to 30 September and the first three weeks of October. By contrast, hotels outside London have traded close to 2000 levels.

M&C recorded mixed results in Asia, with hotels reliant on American guests much more badly hit than those more dependant on regional travellers.

Its Australasian hotels, after a 14% reduction in turnover in the second half of September, are now trading slightly better than last year.

by Samantha McClary