Sun International eyes 3,300 job cuts to navigate through Covid-19 crisis

1st September 2020 (Last Updated September 2nd, 2020 07:19)

Luxury hotels and resorts operator Sun International is planning to slash 3,300 jobs in South Africa and Chile as part of its restructuring plan to withstand Covid-19 headwinds.

Sun International eyes 3,300 job cuts to navigate through Covid-19 crisis
Sun International has plans to cut 3,300 jobs in South Africa and Chile. Credit: Alexander Kaunas on Unsplash.

Luxury hotels and resorts operator Sun International is planning to slash 3,300 jobs in South Africa and Chile as part of its restructuring plan to withstand Covid-19 headwinds.

Lockdown restrictions imposed, to curb the spread of the virus, significantly reduced the number of international travellers and the sale of alcohol, resulting in a half-year headline loss of ZAR885m ($53.26m) at the business, reported Reuters.

For over three months, properties of the hotel company were forced to shut down operations in South Africa.

Its operations in Africa and Latin America continue to remain closed.

Before the pandemic, employee structures were under review at certain operations along with the cost base across its South African businesses.

Sun International CEO Anthony Leeming was quoted as saying by Reuters: “The Covid -19 pandemic required us to undertake a deeper review as we anticipate that it will take some time for our properties, in particular our hotels and resorts, to recover.”

Following the review, the company decided on the layoffs of approximately 2,300 employees in South Africa.

The move is expected to deliver savings of up to ZAR280m ($16.7m) in employment costs, said the report.

It will affect the Sun City resort, the Maslow Sandton hotel, the Boardwalk casino and hotel, The Table Bay hotel and Wild Coast resort.

In Chile, Sun International commenced a voluntary retrenchment process of around 1,000 people. Till date, 451 employees have accepted the offer.

Additionally, the firm identified cost savings of over ZAR250m ($14.9m) in outsourcing and service provider contracts, IT systems and other areas.

Over the six months ending June, the company reported a 56% slump in consolidated income to ZAR3.7bn ($221m).

Furthermore, the firm booked impairment charges of ZAR1.2bn ($71m) related to its hotel and resort properties.