British brewery, pub and hotel operator Marston’s plc (LON:MARS) has seen its share price slide nearly 5% after announcing it will cut up to 2,150 furloughed jobs.
The government’s wage subsidy scheme is set to wrap up at the end of the month, and with a swathe of British cities facing further coronavirus restrictions which have decimated the hospitality industry, Marston’s joins a number of chains which have had to lay off staff to stay afloat in recent months.
Last month, The Independent reported that high street pub chain JD Wetherspoon (LON:JDW) had announced it would be cutting up to half of the jobs across its 6 airport sites following a slump in passenger numbers.
Marston’s was forced to close its doors between April and July as part of the UK’s lockdown measures, and despite several months of trading since then, sales in its pubs were still down 34% year-on-year, while its beer company sales slipped 22% on last year’s figure.
Although outperforming the UK pub sector by a decent 7% overall, Marston’s expressed its regret that it would be unable to sustain 2,150 of the jobs currently on the furlough scheme once the subsidies run out, calling the Coronavirus Job Retention Scheme “vital” to the “health and livelihoods” of its employees.
CEO Ralph Findlay commented on the “testing” year for Marston’s, stating:
“This year has been testing on many fronts, predominantly from having to navigate the consequences of COVID-19. Despite this, we have also created an exciting new joint venture between Marston’s Beer Company and Carlsberg UK during the period. I am grateful to all at Marston’s for their support, resolve and commitment during this time.
“There is much uncertainty ahead, the majority of which is outside of our control, however we will continue to focus on the safety of our teams and guests. Looking beyond the immediate challenges, we look forward to our future as a focused pub operator, returning to growth when trading conditions allow and realising the opportunities which are open to us over the medium to longer term”.
Shares at Marston’s slid a hefty 4.68% to 42.74p at BST 14:05 15/10/20, with a 5.96% drop over the past 3 months.