18th May 2020 09:39
(Alliance News) - Mitchells & Butlers PLC on Monday said it has secured an extension to a temporary waiver granted against possible technical default on the company's loan covenants due to government-enforced closure of its restaurants and pubs.
The waiver to the banking covenants has been extended to June 8.
The FTSE 250-listed pub company - which operates the Harvester, Toby Carvery, All Bar One and Miller & Carter chains - initially secured a waiver from its lenders in April to prevent a breach of its financing arrangements.
The pub and restaurant industry in the UK has been decimated by government-enforced closures to contain the spread of the deadly Covid-19. Several operators have put their staff on furlough, reduced management salaries and have sought government-backed loans to stay afloat.
The UK government has said that pubs will be allowed to reopen on July 4 at the earliest, and then only as long as they can meet "Covid secure" guidelines.
Mitchells & Butlers has put over 99% of its employees on furlough and has cut pay for the remaining employees and for the board by between 60% to 80%. Additionally, the company has curtailed all discretionary capital expenditure projects to save cash.
Shares in the company were up 5.9% at 152.55 pence each in London on Monday morning.
By Tapan Panchal; [email protected]
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