Jarvis cuts staff as profits fall

Jarvis Hotels has cut its workforce by 400 in order to cope with the drastic falls in turnover and profits announced this morning.

Numbers have been reduced from 5,600 to 5,200.

Chief executive Richard Thomason said most of the job losses had occurred through "natural wastage", although there were some redundancies.

He added that in the 12 weeks since the end of March business had improved and the company was more optimistic about the rest of the year. Whereas month-by-month comparisons with last year had been 6%-7% down in turnover, this had now fallen to 2%.

"We can't quite get the cigars out yet, but we are getting there," he claimed.

Jarvis has already started to introduce "cluster" management at some of its hotels, but at a level below general manager. Each hotel will have its own general manager but Thomason is putting in place a number of senior section heads belwo them in areas such as finance and human resources who will deal with a number of hotels.

The company also expects to announce more franchise deals with other hotel brand names in the next few weeks. It is understood that Jarvis has been talking to Cendant about putting the Howard Johnson and Days Inn brands on some of its motorway hotels.

This morning, Jarvis unveiled profits down by 42% to £17m on turnover down by 8.2% to £162.2m in the financial year to 30 March.