Jobs to go at Greenalls as sales growth slows

Pubs and hotels group Greenalls is embarking on a £5m cost-cutting programme that will result in the loss of about 60 jobs.

The news came as chairman Andrew Thomas announced lower-than-expected sales for the first four months of the company's financial year. Since the end of September, sales in continuing businesses have risen by 2.5%, Thomas told the company's annual general meeting last week.

But he added: "Trading in pubs and restaurants has remained difficult and is below both last year and our expectations for the current year. We have increased promotional activity in our pubs against the overall economic background of subdued consumer confidence." Like-for-like pub sales were 4.6% down on last year.

The group's hotels fared better. Room yield at Premier Lodge increased 4.1% on a like-for-like basis, while lodge sales were up nearly 30% overall. At Village Leisure, yield growth averaged 10.4% over the four months but at De Vere like-for-like room yield rose by just 2.1%.

Greenalls is now restructuring its purchasing and distribution arrangements and "other support functions" in a move designed to save about £5m over the year. Thirty head office staff were made redundant last Thursday night and a similar number are expected to follow before September. But the firm said that its expansion programme would create another 1,100 jobs this year.

Greenalls refused to comment on speculation that rival group Whitbread is about to launch a takeover bid for the company (Caterer, 18 February, page 14).

by David Shrimpton