Rising Taxes Deliver a Final Blow to Beefeater and Brewers Fayre Sites

Whitbread PLC, the listed owner of Beefeater and Brewers Fayre has announced it will close all sites, cutting 3,800 jobs.

Posting an outcome of business review to the London Stock Exchange, Whitbread PLC, who also own Premier Inn, stated: ‘Unexpected changes to the prevailing fiscal and trading environment, including higher than expected cost inflation and significant increases in UK business rates, have impacted the financial benefits of the group's previous five-year plan’.

Announcing a new five year plan, Dominic Paul, chief executive of Whitbread PLC said: ‘We always challenge ourselves to improve and, in light of significant cost increases in the form of business rates and national insurance, as well as the implied market discount to our inherent value, we've looked hard at the options open to us to maximise value creation over the medium and long-term’.

Whitbread said it would cut 12% of its staff, stating: ‘The plan we are announcing today is expected to result in a reduction of around 3,800 roles out of a total UK and Ireland workforce of around 30,000’. 

However, the statement also said: ‘We expect to retain a significant proportion of those affected and will be looking to redeploy as many of our impacted colleagues as possible’.

As part of the updated five-year plan, Whitbread said 110 restaurant would be sold, while the remaining  locations would be converted into hotel rooms, stating: ‘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’.

Shares in the listed company fell 3% following the announcement, falling 20% in the past six months. Despite this, Paul said: ‘This plan will transform Whitbread into a higher-margin, higher-returning pure-play hotel business.’

The closures come after Whitbread warned that tax changes in the Autumn 2025 Budget would cost them an extra £50m a year.

At the time, Paul said the company was ‘extremely disappointed’ by the budget outcome, warning it would have ‘a significant impact on our business and the wider hospitality industry.’

The latest accounts for Whitbread PLC show the company had revenues of £2.92bn, in FY25, down from £2.95bn in FY24. Profit before tax was £465m in FY25, down from £537m in FY24, falling by 14% year-on-year.

Source : Business & Accountancy Daily

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