Senior executives at Whitbread PLC, parent company of the Premier Inn brand, underlined the difficulties of trading in the current environment but said that developments in landlord negotiations and traveler sentiment have resulted in confidence moving forward.
A round of job cuts, expected this month at the British firm, now no longer will happen.
On a call with analysts to discuss the 13 weeks of trading up to Nov. 26, 2020, CEO Alison Brittain said early signs of plateauing COVID-19 cases, the rollout of several vaccines and the summer weather to come are buoying traveller sentiment.
“It is the return of confidence that is so important to the economy,” she said.
In September 2020, Whitbread announced it would cut more than 6,000 jobs, but Brittain said that number has now been rolled back to approximately 1,500.
“We were really pleased the outcome was not as high. In law, you have to publish the highest number, and we worked very hard to find different ways to find savings in our operations. We thought there might have been a phase two of redundancies (this month), but we have now closed down that program,” she said.
Alison Brittain, CEO. (Whitbread PLC) |
The company also drew attention with its decision to pay 50% of its rent due in the last quarter of 2020 to landlords—a strategy Brittain said is just about the sharing of some of the pain of the pandemic.
“Historically we’ve been a fantastic tenant and have a fantastic covenant. Our landlords had not helped us, indeed, had not been asked. This is not a criticism, but entering these conversations helped us move onto subjects such as the overtime re-gearing of leases,” she said.
“We have strong liquidity, and we are cognizant of our tenancy responsibilities. We have been sensible and rational. It is not an ongoing notion of our not paying rent,” she said, adding the company’s hotels can make cash contributions to the parent company with very low occupancies.