Company news in brief
28 May 2020 | Business
South African retailer Woolworths yesterday scrapped its 2020 dividend and left a question mark over future payouts, with difficult trading conditions created by the coronavirus outbreak expected to persist for some time.
Woolworths said the toll the pandemic has taken on its business had deepened, with turnover and concession sales dropping 18.5% in the nine weeks to April 26.
It said the virus had affected performance in all its markets - South Africa, Australia and New Zealand.
The retailer, which has previously warned that full-year profits would fall by more than 20%, said these conditions were likely to continue for the "foreseeable future".
It reiterated that it was working to protect the group's financial position, improve its liquidity and capital structure and re-position the business towards long-term shareholder value. – Nampa/Reuters
Pepkor may scrap dividend
Pepkor Holdings said yesterday it does not expect to declare a dividend for financial year 2020, as it looks to preserve cash to tide over the coronavirus crisis after reporting a 13.6% fall in first-half earnings.
The South African retailer's headline earnings per share (HEPS) from continuing operations, including the adoption of IFRS 16, fell to 44.3 cents from 51.2 cents from a year earlier, hit by lower consumer spending.
A nation-wide lockdown to contain the spread of the coronavirus added more worries for retailers, who were already battling dampened consumer spending due to higher taxes, fuel and electricity prices.
The company which decided to close its loss-making Zimbabwe operations last year, said its management is in the final stages of concluding the sale of the business with relevant parties.
Pepkor's revenue from continuing operations rose 6.5% to R37.55 billion in the half year. -Nampa/Reuters
SAA not set to start flying
Administrators for state-owned South African Airways (SAA) said yesterday the airline is not aiming to resume domestic flights from mid-June, rejecting a statement from the airline a day earlier.
SAA is under a form of bankruptcy protection and suspended all commercial passenger flights in late March, when the government imposed one of Africa's strictest lockdowns.
"The position around the cessation of flights remains as is until SAA has a better sense of what the level 3 lockdown means in terms of domestic air travel," SAA's administrators, Les Matuson and Siviwe Dongwana, said in a statement.
"The airline also needs to consider what the opening of the skies will mean from a commercial and load factor perspective."
Matuson and Dongwana said they had not vetted Tuesday's statement from the airline, adding that SAA's future funding remained a key variable for any resumption of flights. – Nampa/Reuters
Hertz awards bonus to key executives
US car rental company Hertz Global Holdings said on Tuesday it has paid about US$16.2 million in retention bonuses to a range of key executives at the director level and above, days after the company filed for bankruptcy protection.
The company paid president and chief executive officer Paul Stone US$700 000, and executive vice president and chief financial officer Jamere Jackson US$600 000 as retention bonuses, Hertz said in a filing to the US regulators.
The firm is reeling under travel bans and lockdowns imposed to curb the spread of the new coronavirus. Since the virus outbreak, a large portion of Hertz's revenue, which comes from car rentals at airports, have evaporated.
With nearly US$19 billion of debt and roughly 38 000 employees worldwide as of the end of 2019, Hertz is among the largest companies to be undone by the Covid-19 pandemic.
Employees who received the retention bonus would forfeit the right to participate in the company's 2020 annual bonus plan. – Nampa/Reuters
Tencent seeks US$6 bn in bond sale
Chinese technology giant Tencent kicked off its offer of bonds worth up to US$6 billion in Hong Kong yesterday, launching the sale even as riot police fired pepper spray to disperse protesters in the city's central business district.
The deal is the biggest international offering by an Asian company this year and will be the first time the social media and gaming firm has offered ultra-long 40-year debt.
Tencent has a quota from China's National Development and Reform Commission (NDRC) for up to US$6 billion, according to a source with direct knowledge of the matter. The sources could not be named because the information has not yet been made public.
A book message sent to investors by the lead banks, seen by Reuters, showed there were US$10 billion worth of orders from investors in the early afternoon in Hong Kong.
Tencent declined to comment on the potential size of the deal. – Nampa/Reuters