The impact of the coronavirus pandemic is expected to be prolonged for IWG, with the business forced to make further provision for up to £160m for network rationalisation.
The office landlord announced in a market update this morning it was taking “further prudent actions” to reduce costs for the business, as it expected its recovery to be delayed.
In line with that, it said a further provision of up to £160m for network rationalisation will be taken with the group’s results for the year ended 31 December 2020.
This is in addition to the £156m hit it took back in August. The office provider said the £160m combined with cost cutting, could see a cost benefit arising in the range of £325m to £375m.
IWG’s share price fell nearly 3.8 per cent this morning on the news.
Group revenue for the year ended 31 December 2020 is anticipated to be approximately £2.45bn.
The FTSE 250 firm posted a 14.3 per cent drop in revenue to £583.3m in the three months to the end of September and warned support measures for customers, including rent deferrals, could cost it £100m by the end of the year.