Marston’s secures £70m liquidity as brewer prepares for sustained pub closures
British brewer Marston’s today said it has secured an extra £70m of liquidity, which will enable it to survive until the end of the financial year even if its pubs remain closed until then.
The pub chain said it could survive a sustained closure of its pubs due to a £70m increase to its financing facility, ongoing government support and continued sales to supermarkets.
It said it has “sufficient liquidity to meet our obligations beyond the end of the financial year even if pubs were closed until then.”
The brewer said it will not recommend any dividend payments for the financial year.
Marston’s has secured agreement with its banks to amend its covenants for September 2020 and March 2021. It has also called a meeting of its bondholders for 29 May to seek some technical waivers and amendments.
In a statement this morning Marston’s said: “The Government has recently announced a recovery strategy to lift lockdown restrictions in phases, including the potential for pubs to reopen in early July.
“However, this timing is by no means certain and is, of necessity, subject to meeting targets relating to containing the virus and the ability to meet ‘Secure Covid-19 guidelines’. We await more detail from the UK Government in due course.
“In order to ensure that Marston’s is best placed to navigate this period of uncertainty, management has taken additional steps to strengthen its balance sheet to provide additional liquidity headroom and financial flexibility.”
Marston’s said in March that it had reduced its capital expenditure “for the foreseeable future” and it is working to reduce overhead costs.