Virus-hit Tabcorp stands down 700 workers
As well as standing down 700 workers, Tabcorp will move other staff to shorter hours and its CEO will take a 20pc pay cut.
Tabcorp is standing down more than 700 employees and moving other full-time workers to eight-day fortnights as it tries to deal with the coronavirus-led shutdowns of hotels, clubs, TAB agencies and sport events.
Chief executive David Attenborough said the company was exploring its eligibility for the federal government’s $130bn JobKeeper wage subsidy, which provides $1500 per worker a fortnight and is expected to pass parliament this week
While Mr Attenborough didn’t give any financial guidance of the coronavirus hit, companies wanting to access JobKeeper must show a 50 per cent plunge in revenue if their annual turnover is more than $1bn.
“This continues to be a very challenging time for our people, businesses, partners and the community,” Mr Attenborough said.
“Our focus is on retaining jobs for the long term. We are committed to working proactively and collaboratively with all our stakeholders so that we can collectively emerge from the COVID-19 period as strongly as possible.”
Tabcorp said the 700 workers - mostly from TAB booths and licenced venues - will be stood down until June 20 and would continue to access their accrued leave entitlements.
Meanwhile other full-time workers will take at least one day of leave per week until June 30 and the company will cut the number of technology contractors by 40 per cent
In addition, Mr Attenborough will take a 20 per cent cut to his fixed remuneration until the end of the financial year, while chairman Paula Dwyer and other board members will take a 10 per cent fee cut.
The company said in a statement to the ASX that it could not reliably quantify how much the COVID-19 pandemic will hit Tabcorp’s earnings but its lotteries and Keno and wagering and media digital divisions continued to operate, with thoroughbred, harness and greyhound race meetings continuing in Australia, except in Tasmania.
“Tabcorp is seeking to mitigate the impacts of COVID-19 on the group’s businesses and
financial position by reducing operating and capital expenditure and reviewing various
commercial arrangements,” Mr Attenborough said.
Tabcorp has reduced its capital expenditure program from a forecast $160m to $120m. The company is also gaining liquidity support through a six-month deferred settlement of state payroll, Keno and lotteries taxes, which normally total more than $40m a month.
In late March 2020, Tabcorp expanded its banking facilities through an additional $226m short-term facility, payable July 2021. As of last week, the company said it had undrawn facilities of $100m and unrestricted cash of $649m.
“Other than the US private placement of $171.5m, fully hedged, which matures in December 2020, there are no other debt maturities until April 2022,” Tabcorp said in a statement to the ASX.
Tabcorp has also suspended payment from licensed venues of fees owed relating to Sky Racing, TAB, Keno and MAX contracts. The suspension will initially be the month of April and the company will review it month by month as it assesses further COVID-19 developments, such as additional government directions.
More Coverage
Drinks giant brewing up international expansion
Bundaberg Brewed Drinks is planning to reveal a new flavour for its growing South Korean market – its first new product specifically for the international market.
ASX experiences its best month for Aussie shares in two years
Australia’s sharemarket has broken records this week all while its US counterpart takes a deep breath to recover from the shock of China’s AI capability.