Pub chain Marston's with 21 Scottish sites to cut more than 2,000 jobs
The group warned that about 2,150 of its pub workers currently on furlough support were likely to be impacted, while it will also launch a further cost-cutting plan by the end of the year.
It becomes the latest big hospitality operator to have to axe staff amid draconian coronavirus restrictions across large swathes of the UK.
Earlier this week, Mitchells & Butlers, the pub and restaurant giant that owns All Bar One, Toby Carvery and steakhouse chain Miller & Carter, said it had kicked off redundancy talks with staff as it struggles with the fallout from the pandemic.
Last week, rival Greene King – owner of Dunbar’s historic brewery Belhaven – revealed plans to cut about 800 jobs, while fellow pub businesses Young’s, Fuller’s and City Pub Group have also said they are planning redundancies.
Marston’s put the blame for its cost-cutting squarely on the recent measures to tackle the surge in coronavirus cases.
The firm said it has 21 sites in Scotland, of which eight are currently closed, and 18 in the “Tier 3” Liverpool region, although the majority of these serve food and are allowed to remain open.
Chief executive Ralph Findlay said: “The additional restrictions which have been applied across the UK most recently present significant challenges to us and will make business more difficult for a period of time.
“I very much regret that the consequence of this is that the jobs of around 2,150 of our colleagues will be impacted, but it is an inevitable consequence of the limitations placed upon our business.
“We will be looking at our cost base further in the coming weeks.”
The group claimed the new rules “undermine consumer confidence and create uncertainty”.
It added: “The introduction of these further restrictions and guidance affecting pubs is hugely disappointing in view of a lack of clear evidence tying pubs to the recent increase in infection levels, and our own data which suggests that pubs are effective in minimising risks.”
Details of the job cuts came as the firm’s annual results showed pub sales tumbled 34 per cent to £515 million in the year to 3 October, impacted heavily by the spring lockdown earlier this year.
Since pubs reopened in July, like-for-like pub sales were 10 per cent lower over the 13-week period, helped by the UK government’s Eat Out to Help Out meal discount scheme in August.
Brewery sales were 22 per cent lower over the year at £306m, though sales in retailers and off-licences lifted 23 per cent as pubs were forced to close.
Shore Capital analyst Greg Johnson said: “The key takeaway being that the group remains cash flow positive whilst pubs remain open and following the completion of the Carlsberg Marston’s Brewing Company [joint venture] retains ample liquidity.
“Going forward, the focus will likely remain on debt reduction, which should help unlock the value in its £2 billion pub estate and the retained 40 per cent stake in the brewing [joint venture].”