24th Apr 2020 09:23
(Alliance News) - Transport operator FirstGroup PLC on Friday said it has raised GBP300 million under the UK government's Covid Corporate Financing Facility, bolstering the company's committed lending headroom and free cash to GBP800 million.
Shares in the company were up 4.2% higher at 61.70 pence each in London.
The FTSE 250-listed company also said its US coach unit Greyhound is expected to be a major recipient of the USD326 million in CARES Act funding allocated to US states in support of intercity bus services.
Greyhound's revenue has fallen by 80% since the start of the coronavirus outbreak, and the business is operating just over a third of its pre-outbreak timetabled mileage at present.
In the UK, the company's First Bus is operating at 40% normal capacity. It has seen a 90% drop in passenger volumes but is providing services for key workers. The First Rail franchises are operating under the Emergency Measures Agreements, under which the government has waived each operator's revenue, cost and contingent capital risk until at least September 20 and during which time the operators will be paid a fixed management fee.
FirstGroup, in light of the substantial drop in passenger volumes, has continued to take proactive steps to prioritise cash flow, it said. A substantial proportion of its total workforce in North America and the UK has been placed on furlough, and the company also has made significant reductions in all non-essential operating and capital expenditures.
Further, Chief Executive Matthew Gregory and Chief Financial Officer Ryan Mangold have volunteered to take a 20% pay cut for three months. Chair David Martin and non-executive directors have also volunteered a corresponding reduction in their fees for the same initial period.
CEO Gregory said: "As an organisation we have taken rapid action to manage our costs, preserve cash and protect the group's financial position in order to ensure we are able to deliver the continuity of transport that is so essential to governments, local communities and our customers both now and once the present crisis is overcome.
"The long-term fundamentals of our businesses remain sound, and we will continue to take all necessary measures to ensure that the Group emerges from this unprecedented situation in the most robust position possible to deliver our strategic plans".
By Tapan Panchal; [email protected]
Copyright 2020 Alliance News Limited. All Rights Reserved.
Related Shares:
Firstgroup