Marston’s scraps £20m dividend to save cash amid coronavirus crisis
Shares in pub chain Marston’s jumped 43 per cent this morning as it outlined its coronavirus battle plan, which included cutting a £20m dividend.
The company said that the need for social distancing as a measure to combat the spread of the virus means it is “unlikely” that it will recommend an interim dividend in May.
Sales were down one per cent in the 24 weeks to 14 March, however the chain warned that new recommendations to avoid pubs and clubs would have an impact on trading going forward.
Marston’s said it has reduced its capital expenditure “for the foreseeable future” and it is working to reduce overhead costs.
The operator said that it will suspend tenants’ rent on a “case by case basis where it is appropriate to do so”.
The government yesterday announced plans to help the hospitality and retail sector, including a £330bn government backed loans and a business rates holiday.
In a statement this morning Marston’s said: “We welcome the measures outlined by the UK Government yesterday to provide support for the hospitality sector.
“The overriding message was ‘we will do whatever it takes’ to ‘support jobs, income and businesses’.
“The measures proposed include the provision of £330 billion to provide liquidity for businesses, and significant reliefs for business rates and rent.
“Further measures are to be proposed which are intended to support employment. Whilst the full details of these proposals have still to be scrutinised, they represent good progress towards the very significant commitment which the hospitality sector requires from the Government, and an acknowledgement of the importance of pubs to jobs, the economy, and communities.”