COVID-19 Update - 23 March 2020
IWG plc, the global operator of leading coworking and workspace brands, today provides an update in respect of COVID-19.
On 3 March 2020 we reported strong revenue and profit growth. We ended 2019 strongly and this provided a positive start into January and February. In our 2019 results statement, we indicated that the outbreak of COVID-19 had led to a brief closure of some centres in China. All these centres are now operational. We expect there to be pressure on our global business as countrywide lockdowns are implemented in an increasing number of geographies. We continue to closely monitor the ongoing developments in relation to COVID-19 and are taking appropriate actions to reduce operational costs, limit both growth and maintenance capital expenditure and optimise cash flows.
Accordingly, in the circumstances, the Board has taken the prudent, precautionary decision not to pay the final dividend of 4.8p previously declared with the Group's 2019 full year results. Consequently, the resolution in respect of the 2019 final dividend will not be proposed at the AGM scheduled to be held on 12 May 2020. The Group's dividend policy will be kept under review.
In addition, the Board is taking the prudent decision to temporarily suspend the updated £100m share repurchase programme that was announced on 3 March 2020. To date £27.5m has been spent on this programme.
The Group's financial position remains strong, with a low level of financial leverage and substantial access to liquidity. Our net debt to EBITDA ratio (on a pre-IFRS 16 basis) as at 31 December 2019 was 0.7x. On 9 March 2020, we extended the maturity profile of the £950m Revolving Credit Facility until March 2025.
At the present time, given the evolving nature of the COVID-19 pandemic, it is too early to provide earnings guidance in relation to the remainder of the current financial year. 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, as set out in the 3 March 2020 results presentation.
Our priority remains the health and wellbeing of our customers, partners and employees and we are continuing to ensure that we have the appropriate measures and precautions in place for their safety.
This announcement contains inside information.
For further information, please contact:
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IWG plc Tel: + 41 (0) 41 723 2353 Mark Dixon, Chief Executive Officer Eric Hageman, Chief Financial Officer Wayne Gerry, Group Investor Relations Director
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Brunswick Tel: + 44 (0) 20 7404 5959 Nick Cosgrove Oli Sherwood
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This trading update contains certain forward looking statements with respect to the operations of IWG plc. These statements and forecasts involve risk and uncertainty because they relate to events and depend upon circumstances that may or may not occur in the future. There are a number of factors that could cause actual results or developments to differ materially from those expressed or implied by these forward-looking statements and forecasts. Nothing in this announcement should be construed as a profit forecast. |
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