P&O Ferries to cut 1,100 jobs – but owner to pay out £270m in dividends

P&O Ferries has announced plans to cut 1,100 jobs after reporting a severe downturn in demand.

The cuts, affecting more than a quarter of the group’s workforce, come after the firm’s owner, the Dubai-based DP World, had been seeking about £150m in UK government aid. It is also only two months since DP World said it would be paying its investors about £270m in dividends.

P&O operates passenger ferries between Dover and Calais, as well as Hull to Rotterdam and Zeebrugge, plus services across the Irish Sea. It also says it transports 15% of all goods in and out of the UK.

A P&O spokesman said: “Since the beginning of the crisis, P&O Ferries has been working with its stakeholders to address the impact of the loss of the passenger business.

“It is now clear that right-sizing the business is necessary to create a viable and sustainable P&O Ferries to get through Covid-19. Regrettably, therefore, due to the reduced number of vessels we are operating and the ongoing downturn in business, we are beginning consultation proceedings with a proposal to make around 1,100 of our colleagues redundant.”

It is understood that the company will initially offer employees voluntary redundancies, leaving the business with about 3,000 employees.

P&O has already furloughed about 1,400 staff, the majority of whom the company said were in its passenger business.

The firm has also received some further government assistance via a freight scheme announced by the Department for Transport last month, although P&O would not reveal how much the support was worth.

P&O declined to say where in the company it expected the job losses to fall and said the lasting cuts were planned instead of additional furloughing as the business needed to get through Covid-19 and beyond.

As well as P&O, DP World owns the ports of Southampton and London Gateway, plus dozens more around the world. Last year the company made profits of more than £1bn on revenues of more than £6bn.

DP World is 80%-owned by the Dubai state and the rest by international investors, but it is in the process of delisting its shares from Dubai’s Nasdaq stock exchange.

A DP World spokesman said the £270m of dividends announced in March related “to a delisting process, which was announced pre-Covid-19 and which DP World is legally obliged to pay”.

Source: Read Full Article