Whitbread Restaurants Cuts 3,800 Jobs in Beefeater Closure
Whitbread restaurants will cut about 3,800 jobs as it shuts its remaining Beefeater and Brewers Fayre sites in the UK and Ireland. The move reaches about 12% of its 30,000-strong workforce and pushes the group further toward a hotel-only model.
Dominic Paul said Whitbread plans to convert all remaining branded restaurants to an integrated food and beverage offer and unlock more highly profitable extension rooms. Whitbread said consultations with affected employees would begin immediately, and it expected to retain a significant proportion of staff affected by trying to move them into alternative roles.
Paul’s hotel plan
197 restaurants are still in the portfolio Whitbread intends to reshape across the remaining estate. The company had already started converting some underperforming Beefeater and Brewers Fayre restaurants into hotel rooms, and it said it would continue that policy across the sites still open.
We plan to convert all our remaining branded restaurants to an integrated food and beverage offer that is preferred by our hotel guests and will unlock the addition of more highly profitable extension rooms. Our continued efforts to drive our commercial plan and efficiencies will extend our market-leading position and allow us to take share from our competitors, many of which are struggling to grow.
£1.5bn and 800 Premier Inn hotels
£1.5bn is the amount Whitbread said it intends to recycle through sales and leasebacks of freehold properties to fund future growth. The company said it would increasingly hope to lease its hotels, a shift that fits a business already built around more than 800 Premier Inn hotels in the UK.
Whitbread said revenues for the year to 26 February were flat compared with the same period a year earlier. It also had already warned that Rachel Reeves’s 2025 budget tax policies would cost it an extra £50m this year, with the increase linked to changes in the way business rates are calculated.
Shares down almost 7%
Almost 7% was wiped from Whitbread shares in early trading after the announcement, extending a drop of more than 20% over the past six months. Corvex said in December it had taken a 6.05% stake and argued the share price undervalued assets including the UK leasehold portfolio.
The company has been moving away from restaurants for years: it sold Costa Coffee to Coca-Cola in a near-£4bn deal about seven years earlier, and the Beefeater brand itself dates back to 1974. For employees in the closures, the immediate issue is whether the consultations lead to one of the alternative roles Whitbread says it will try to offer, or to the end of work in the chain’s remaining branded restaurants.
