Intu Properties Plc - Statement on Covid-19 Impact
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INTU PROPERTIES PLC
STATEMENT ON COVID-19 IMPACT
In light of the rapidly evolving COVID-19 situation, intu provides the following update. Our three priorities are to look after our employees, to protect our business and to play our role in society.
All of our centres in the UK and Spain are operating on a semi-closed basis. In line with the latest Government advice in both countries, only essential stores, such as supermarkets, pharmacies and banks, remain open.
Rent for the second quarter of the year in the UK was due on 25 March (the quarter day) and we have received 29 per cent of this. We are in discussions with our customers on the outstanding rents. For the same period last year, we had received 77 per cent on the quarter day.
As at 24 March 2020, we had immediately available cash and facilities of £184 million at the corporate level. The impact of COVID-19 in Europe is delaying certain regulatory approvals in relation to the disposal of intu Puerto Venecia and we now expect the £95 million proceeds to be received in the middle of May at the earliest.
We have significantly reduced capital expenditure for the foreseeable future and are cutting back on head office costs to maintain additional cash within the business. In addition, to support our customers, we have initiated a programme of reducing non-essential service charge costs and are passing on these savings to them.
The reduced social activity is likely to continue for the foreseeable future impacting our footfall and potential future rents. The impact of the reduced rents received is expected to require us to seek covenant waivers and we are in constructive discussions with the relevant lenders.
In addition to the immediate actions we have taken to preserve liquidity, we have an ongoing dialogue with the UK Government and may look to access their £330 billion support package. In their recent announcement for the protection of commercial tenants from the non-payment of rent, they also stated that they are actively monitoring the impact of this on commercial landlords' cash flow. Other Government measures announced of business rates suspension, employee cost support and tax payment deferrals, are also expected to have a positive impact.
Given the ongoing uncertainty around COVID-19, we are no longer able to provide guidance in relation to the 2020 financial year.
In these difficult times we continue to assess all strategic alternatives and will provide further updates as appropriate.
The person responsible for arranging the release of this announcement is Susan Marsden, Company Secretary of intu properties plc.