Thwaites is set to initiate a programme of redundancies in a bid to shore up cash following the crisis.
Despite noting that trade has “built steadily” since its estate reopened in July, the pub operator said it has “become very clear in reopening that the visibility we had last year on forward bookings has been greatly shortened”.
It added that there was “no sign” this will change as winter trading ensues, and for this reason, the group has made the “unwelcome decision” to go ahead with the redundancies.
In a statement, chairman Richard Bailey said the move will “ensure our cost base reflects the environment that we expect to operate in over the coming months and protect the business against significant ongoing uncertainty”.
The move comes as the group outlined previous measures it had undertaken to shore up cash during the crisis.
This includes its board and executive team taking pay cuts of up to 30%, assisting pub tenants in claiming grants negotiating either reduced costs or suspension of contracts with suppliers and putting all non-essential capital expenditure on hold.
Nonetheless, the group said it has seen a “steady growth” in sales since reopening, and remains “encouraged” that its net debt has stabilised and begun to reduce.
However, with reduced capacities and permitted activities in place due to social distancing, it wanted that sales “will not be capable” of returning to pre-crisis levels until those restrictions are no longer required.
In light of this, the group has taken the decision to pass on its final dividend for the year ended 30 March 2021. Bailey said he understood the decision “will be an unpopular one, it is not one that has been taken lightly, nor without thought of the impact that it might have on our shareholders”.
In a statement, he added: “Whilst this pandemic is unexpected, the company embarked upon Covid-19 and shutdown in good health. Our initial experience upon reopening has been better than we had at first hoped, however the coming months are likely to test us again.
“The company has been through troubled times before and has a strong asset base and an experienced management team to assist in finding a pathway through the challenges we face.”