LASTMINUTE.COM has revealed the UK will bear the brunt
of its cost cutting programme with 220 jobs and six offices to
go.
The company is targeting annual savings of £16 million by
2005 through jobs cuts, integration of acquired companies and
increased efficiency in its various departments.
Consultation for office closures in Farringdon, Twickenham,
Golden Square and Bracknell has already begun, with two further
sites under review.
Of the 220 UK jobs, 25 senior roles will be axed from the group,
contributing £3 million annually in cost savings. Jobs will
also go in marketing, production, finance and technology, with the
majority – around 105 – going from consolidated call
centres.
In a presentation to analysts, chief operating officer Ian
McCaig said Lastminute is looking at the possibility of boosting
the number of homeworkers it employs and outsourcing its entire
ticketing and fulfilment function.
“We are at a stage where we have the technology to introduce
homeworking and we think there are a lot of travel industry people
out there who want more flexible working and would be keen to do
this.”
In total, 350 jobs and 10 offices will go as part of the cull,
which will cost the company £9 million to execute (Travel
Weekly August 13).
Other areas under review include Lastminute’s corporate
travel arm, which employs around 170 staff.
In a market update, chief executive Brent Hoberman warned
earnings before interest, tax, depreciation and amortisation for
the year are likely to be towards the lower end of expectations at
around £27 million. It has targeted EBITDA numbers to be
£55 million for the 2005 financial year.
Hoberman said trading remains “challenging” and the company is
experiencing higher volumes of low-margin flight bookings and
commission-heavy hotel sales than expected.
However, trade commissions from the Holiday Autos and Medhotels
businesses will not be targeted.
A spokeswoman added: “We see no real leverage in trying to cut
commissions.”