TIDMYNGA
RNS Number : 9183H
Young & Co's Brewery PLC
27 March 2020
27 March 2020
Information within this announcement is deemed by Young's to
constitute inside information under the Market Abuse Regulation
(EU) No. 596/2014.
Young & Co.'s Brewery, P.L.C.
("Young's" or "the Company")
COVID-19 and Dividend Update
Notifications pursuant to AIM Rules 11 and 17
Young's provides a further update in light of the ongoing
Covid-19 situation. This follows the Government's order, on 20
March 2020, that all pubs in the UK had to close that same day and
that the country would be entering into a three-week period of
lockdown. The Company's previous update was on 19 March 2020.
People
The Company is accessing the Government's Coronavirus Job
Retention Scheme (the "Scheme"). Through the Scheme, HMRC will
reimburse 80% of the wages, up to GBP2,500 per month, of those
individuals who would otherwise be laid off during this crisis. As
such, those individuals, known as 'furloughed workers', will be
kept on the Group's payroll but will stop working.
As a result, the vast majority of the Group's employees
(including over 4,500 weekly and monthly paid staff in the Group's
pubs) have been designated as 'furloughed workers'. 29 'key
workers' have not been furloughed; they have essential roles to
play and will carry on working from home while this crisis
continues and the Group's pubs are closed.
Recognising that Young's would be nothing without its people,
the Board has agreed that the Group will, on top of the monies
received from the Government, fund the wages of all its furloughed
workers whose annual salary was more than GBP30,000 so that they
will continue to receive 80% of their normal pay.
These arrangements apply for April, are designed to protect jobs
for the longer term and will be reviewed again as necessary before
the end of next month.
Final dividend for the year ended 30 March 2020
As part of its focus on prioritising cash conservation, the
Board has concluded that it is not appropriate to recommend payment
of a final dividend for the Company's financial year ended on 30
March 2020.
Committed facilities and cash management
The Company has in place GBP235 million of committed facilities
from its banks and private placement lenders. The Company's net
debt to EBITDA covenant is set at 5x.
The Company is continuing to take other appropriate measures to
help reduce costs so as to conserve cash, optimise working capital
and protect the Company's financial position. All capex has been
put on hold, resulting in a significant reduction in capex for
FY2020/21. That, alongside not paying a final dividend for the year
ended 30 March 2020, plus a GBP7 million VAT deferral until March
2021 and a GBP14.5 million business rates holiday, provides the
Group with further headroom to put it in a strong position to
weather this crisis.
The Company continues to have a very strong balance sheet
supported by a predominantly freehold estate. It has one of the
lowest gearing ratios in the industry at 25.7% (as reported at the
Group's Interim Results in November 2019).
In addition, the Company remains in ongoing discussions with its
banks, which are collectively very supportive, and is seeking to
ensure additional covenant headroom. The Board is also in the
process of understanding whether it can access the Bank of
England's Covid-19 Corporate Financing Facility.
Taking all of this into account, the Board believes that Young's
has sufficient headroom to deal with an extended period of
closure.
Preliminary results announcement
The Board expects to release the Company's preliminary results
announcement for the year ended 30 March 2020 on 21 May 2020.
Patrick Dardis, Chief Executive of Young's, commented
further:
"In a business like Young's, people are vital. We undoubtedly
have some of the most fantastic, creative, entrepreneurial,
hard-working and caring people in the industry and I'm therefore
pleased that, with support from the Government, we are able to
retain all of them and keep their pay at not less than 80% of what
they would normally be getting. The Board has also agreed to take a
20% reduction in basic pay.
The way in which our people have handled the closures of 'their'
pubs and supported their colleagues makes me very proud. The Board,
along with the others at Riverside House entrusted with the
safekeeping of the business, is very much up for this
challenge.
As I said previously, this crisis will be temporary. I am
therefore looking forward to all our team reuniting, opening the
doors to our great pubs and welcoming back our customers once we
are through this. We remain confident in our strategy for the
business."
- Ends -
Anthony Schroeder
Company Secretary
27 March 2020 (14:40 GMT)
Tel: 020 8875 7000
Contacts:
Young & Co.'s Brewery, P.L.C. 020 8875 7000
Stephen Goodyear, Chairman / Patrick Dardis, Chief Executive
J.P. Morgan Cazenove (AIM nominated adviser and joint broker) 020 7742 4000
James Mitford / Behzad Arbabzadah
Panmure Gordon (joint broker) 020 7886 2500
Erik Anderson
MHP Communications 07551 170 451
Tim Rowntree / Alistair de Kare-Silver youngs@mhpc.com
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END
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