Hyve suspends dividend, leadership team takes 20% pay cut amid Covid
By Michele Maatouk
Date: Wednesday 08 Apr 2020
(Sharecast News) - Exhibitions and conference company Hyve said on Wednesday that it was pulling its dividend due to the Covid-19 outbreak as more than a quarter of its workforce has been put on furlough and the leadership team takes a pay cut.
As a result of government actions to slow the spread of the virus, Hyve said that only three of its top 10 events ran in the second quarter, including Bett and Mining Indaba, both of which reported strong year-on-year growth. Spring Fair also took place despite an ongoing impact from Brexit and reduced attendance by Chinese exhibitors.
In response to the pandemic, Hyve has postponed 33 events to later this year, while a further 12 have been delayed until FY21 and eight have been cancelled.
To protect its financial position, the company has introduced a freeze on salary rises and recruitment, removed current year bonus plans, postponed capital projects and cancelled contractor contracts.
In the UK, over a quarter of the workforce has been put on furlough leave, as part of the UK Government's Coronavirus Job Retention Scheme and the leadership team has taken a temporary 20% pay cut. In addition, the board has decided not to pay a dividend for the current financial year.
Hyve also said it is in constructive dialogue with its lenders in relation to covenant headroom and facility flexibility. It has already secured a waiver of the June 2020 covenant tests under the debt facilities. The company said last month that it has access to total committed debt facilities of ?250m, which have been fully drawn in order to maximise flexibility in terms of short-term liquidity.
"Whilst management continues to take action and review further options to secure the group's long-term financial position, the board believes that the decisive actions being taken will improve the group's financial and operational footing and help to safeguard the group's customers, colleagues and communities.
"The board remains confident that the group's strategy of focusing on market-leading events provides a strong platform to deliver growth post the current crisis."
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