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Published on Monday, April 6, 2020

Southend Airport owner furloughs half of staff, directors lose fifth of pay






Southend Airport owner Stobart Group has furloughed about 50% of its 1,500 employees and board and senior members of the management team have taken 20% pay cuts while other non-furloughed management have seen their pay reduced by 10%.


The Group, which also owns Stobart Energy, said in a trading update this morning that it had 'moved swiftly' and taken proactive steps to protect its liquidity and cashflow.


It has frozen all capital expenditure other than where it is critical for safety reasons, and discretionary spend has been deferred. 


A freeze on recruitment has been in place since early March and all variable pay awards have been deferred to August 2020 at the earliest, said the Group.


Stobart said it had utilised all measures made available by the Government 'to help conserve cash'.


"These steps have been taken both to maintain the operational capability of our core businesses and ensure they are well placed to gear back up when the recovery takes place," it said in the update.


"At all times we have committed, as a responsible business, to follow all Government advice. The safety and wellbeing of our staff and the communities we operate in have been at the forefront of the Board and management's thinking.


"The cumulative effect of these actions is to preserve the Group's liquidity and provide cash headroom. Given the level of current uncertainty, particularly regarding the potential duration of the crisis, the Board is also taking prudent steps to explore further funding options.  


"The Board has determined it is not possible to provide financial guidance for the Full Year at present and is withdrawing all previously made guidance."


Most flights from Southend have been suspended and more than 20 aircraft are currently sitting on the airport's stands. Wizz Air continues to operate a reduced service of three weekly flights to Bucharest and Loganair has flights to Aberdeen and Derry three times a week.


The airport's global logistics operation continues to operate as normal and the Holiday Inn hotel at the airport remains open to provide accommodation for key workers. Stobart said it is seeking further opportunities to support community groups.


Stobart Group chief executive Warwick Brady said he was 'immensely proud and humbled by the response of our people to this global crisis'. 


"We have acted at pace to put in place steps to safeguard our business in the immediate term, and our people have consistently understood and supported the actions we have taken. 


"Despite the current challenges presented by the Covid-19 virus, we continue to own and operate aviation and energy assets with significant underlying value. There remain significant medium and long-term opportunities to further increase the value of the assets for our stakeholders. 


"We are maintaining regular communication with our partners and ensuring we are well placed to get back to full operation quickly once this exceptionally challenging time has passed."


 

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