Hotels group slashes 500 jobs

Millennium & Copthorne, the four-star hotels group, has cut 500 jobs and warned of lower than expected second-half profits following a sharp fall in revenue in its American hotels after the terrorist attacks in September. The cuts will be divided equally between the United States and the UK where the main offices are in London and Horley, Sussex.

Millennium & Copthorne, the four-star hotels group, has cut 500 jobs and warned of lower than expected second-half profits following a sharp fall in revenue in its American hotels after the terrorist attacks in September. The cuts will be divided equally between the United States and the UK where the main offices are in London and Horley, Sussex.

Of the group's 86 hotels, 22 hotels are in the US and the bulk of its American profits come from four hotels in New York. In the 16 days ended 30 September, revenue in the US has fallen by 61 per cent compared with the same period last year. Trade has since picked up a little though US revenue in the first three weeks of October was still down 39 per cent on last year.

One of the group's hotels is out of action altogether as it is within the restricted access zone near the World Trade Centre site. The Millennium Hilton could remain closed for two years, the company said. Initial insurance payments of $7.5m have already been received.

The knock-on effects of fewer American tourists have also hit the group's operations on other markets. Its London and continental European hotels have seen revenue down by 29 per cent. The only bright spot was the regional UK hotels which have traded "close to 2000 levels in the five weeks to 21 October".

The company said it expected group profits to be "very substantially below" those achieved in the first six months.

Half-year profits were £46.2m. Analysts cut their full year profit forecasts to £55m to £60m from £90m to £100m for the year to December.

John Wilson, Millennium & Copthorne's chief executive, said the market for corporate bookings was "eerie" as big businesses delayed travel plans.

The shares fell 3p to 213p.