Thistle counts cost of terror fallout

INVESTORS checked out of Thistle after London's largest hotelier disclosed the damage inflicted on business by the 11 September terrorist attacks, and warned of more tough times ahead.

Business in the capital had fallen more than 26% in the 15 weeks to 31 December and the group has been forced to cut around 600 jobs, 10% of its workforce, since the terrorist attacks.

'Trading conditions have been very difficult in recent months, particularly in London,' said chief executive Ian Burke. 'It remains difficult to forecast prospects for the hotel industry for 2002 and we remain cautious on market conditions for at least the next six months.'

Prior to the update, analysts had pencilled in full-year pre-tax profits of £53.6m, a slide on the £68.2m of the previous year. The stock had tumbled 5 1/2p to 112p by mid-afternoon.

Thistle said turnover for the 2001 fell 5.9% on the previous year to £305.3m. Revenue per available room was also down, as were occupancy levels. Its regional hotels reported a 6.8% decline in turnover, while its sites at Gatwick and Heathrow airports saw even bigger falls.

The cost cutting meant net debt at the end of the year was comparable to last year's £430m. Thistle said it was still keeping a close eye on its costs, but had no immediate plans to lay off more staff. 'I'm not ruling out taking any further action but we haven't got any plans to announce on that,' Burke said.