Tool hire firm furloughs 1,725 staff as crisis continues to hit trading
Tool hire firm Speedy has furloughed 1,725 staff in response to the ongoing crisis.
The Manchester based business has also closed a number of its smaller stores with no sign of the lockdown finishing any time in the near future.
The firm provides tools and equipment hire and services to the construction, infrastructure and industrial markets.
Covid-19 had an impact on trading towards the end of March, with some business areas operating at reduced activity levels.
Demand for certain products and services has reduced, many projects are continuing, new opportunities are emerging and others accelerating as economic conditions permit.
The company said it has retained a substantial proportion of its revenues entering its new financial year.
Wherever possible employees are working from home but the firm has furloughed 50% of its staff.
Speedy is maintaining national coverage through its larger superstores from which it is able to service customers who are providing essential services.
All depots are physically closed to customers, with trading now being undertaken solely through the group’s digital platforms or by telephone.
A recruitment freeze is in place and the annual salary review due on 1 April 2020 has been deferred.
All directors and the leadership team have agreed to reduce salaries and fees by 20% for a period of three months from 1 April 2020.
The group has taken advantage of government actions, including payroll support for furloughed colleagues, business rates relief, and a reduction, or deferral, in taxes payable.
The board is still considering whether it will recommend a final dividend on the announcement of its final results.
Russell Down, chief executive said: “Speedy has an important role in supporting the delivery of customers’ projects and particularly those providing essential services at this critical time.
“We are proud to be supporting several COVID-19 related projects, including the establishment of the Nightingale hospitals, and have offered our four-hour delivery service free to all NHS providers.
“We have taken significant measures to protect our financial position whilst preserving our ability to continue trading and to respond quickly to changing market conditions. Over the medium term we remain well positioned to benefit as normal trading conditions resume.”
Meanwhile, house builder Redrow has been confirmed as eligible for the Covid Corporate Financing Facility (CCFF) with an issuer limit under the facility of £300m. The facility is currently undrawn.
Negotiations for the additional £100m of headroom under the group’s existing revolving credit facility (RCF) with its six relationship banks are progressing well and the documentation is expected to be concluded by the end of April.
This will result in the existing RCF increasing from £250m to £350m.
Currently around 80% of the workforce has been furloughed under the Government’s Job Retention Scheme.
In March the board and senior directors in the business announced internally they had volunteered to take a 20% cut in salary for the duration of the crisis.
Since then, the wider directorate in the business have also volunteered to take a salary cut of 20%.
John Tutte, executive chairman said, “The response from colleagues and customers during these unparalleled times has been magnificent and I am grateful for their continuing support and understanding.
“The positive progress we have made on securing additional banking facilities means we can now finalise plans for our valued workforce and supply chain, to make an orderly return to work when we are advised it is safe to do so”.