LONDON (ShareCast) - (Sharecast News) - Pub and restaurant operator Mitchells & Butlers said it had scrapped dividends until until the end of the 2021 financial year in return for new loan financing and waivers as it dealt with the coronavirus crisis.
The company on Friday added that it currently expected to start reopening sites from July and was burning through £30m - £35m a month before debt servicing.

It agreed £250m in unsecured lending made up of an extension to the term of an existing £150m of credit, plus additional facilities worth £100m structured under the UK government's Coronavirus Large Business Interruption Loan Scheme.

The company also agreed to changes and waivers on its secured lending arrangements after technical breaches that occurred due to the government-imposed lockdown imposed in March.

"In securing these valuable amendments the group has agreed not to pay an external dividend, undertake any share buy-backs or repurchase bond debt until the end of the financial year to September 2021, at the earliest," the company said.

'"The financial arrangements we are announcing today put us in good shape to address the challenge ahead based on what we believe to be a conservative downside scenario in which the reopening of any of our sites is delayed until October and sales then build back to reach full previous year trade levels over the period to July 2021."

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