23rd Mar 2020 09:35
(Alliance News) - IWG PLC on Monday said it will not be paying a dividend declared at the time of its full-year results announcement amid uncertainty caused by Covid-19.
The Luxembourg-based provider of service offices said it ended 2019 "strongly" and this provided a "positive" start into January and February.
The company said that some centres that were closed in China at the beginning of March are now operating again. However, IWG said it expects there to be pressure on its global business as countrywide lockdowns are implemented in an increasing number of geographies.
Therefore, it is taking action to reduce operational costs, limit both growth and maintenance capital expenditure and optimise cash flows. This includes the cancellation of the final dividend of 4.8 pence previously declared.
In addition, IWG said it will temporarily suspend the GBP100 million share repurchase programme. To date GBP27.5 million in buybacks have been completed.
IWG said its financial position remains "strong", with a low level of financial leverage and substantial access to liquidity. On March 9, IWG extended the maturity profile of the GBP950 million revolving credit facility until March 2025.
"While the implications of Covid-19 are difficult to determine, the board is confident in the long-term structural growth drivers of the global flexible work market and IWG's strategy to maintain its leading position within it," the company said in its statement Monday.
IWG shares were trading 19% lower in London on Monday at 130.20p each.
By Evelina Grecenko; [email protected]
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