Choice Hotels Europe (CHE) has announced it expects its full-year results to be significantly below market expectations due to substantial losses in the latter half of 2006.
However the group has already started a company-wide review of all business process and practices to restructure and remove unnecessary costs from the business, it said.
Fourth quarter revenues in 2006 for the group declined sharply as the group underwent significant restructuring and refurbishment.
In addition CHE incurred one-off costs related to the disposal of the European Master Franchise Agreement with Choice Hotels International.
In its January trading update the company said: "It is clear from the unsatisfactory results anticipated that we have to take action to ensure that our revenue delivery is more robust and that the cost base of the organisation is made much more responsive to the occasional shocks that characterise the short lead time, dynamic environment in which we operate."
By Emily Manson