TIDMDTG
RNS Number : 7141K
Dart Group PLC
24 April 2020
24 April 2020
Dart Group PLC ("the Group")
Trading Update
Dart Group PLC, the Leisure Travel and Distribution &
Logistics group, today issues the following update.
Year ended 31 March 2020 (FY20)
Further to the Trading Update issued on 18 March 2020, the Board
expects to report pre-exceptional Group profit before foreign
exchange revaluation and taxation for the financial year ended 31
March 2020 of between GBP265m - GBP270m, an increase of
approximately 49% on the prior year.
Exceptional items - Although Jet2.com and Jet2holidays are
currently on sale from 17 June 2020 in readiness for when our
holiday flights can resume, due to operations currently being
suspended for an indeterminate period of time, the Board estimates
that the Group will record a net exceptional charge of
approximately GBP109m relating to ineffectiveness on a proportion
of FY21 fuel and foreign currency hedges in the FY20 results.
We continue to actively monitor the financial health of our
hotel counterparts in respect of our advance deposits and their
potential for recovery. Contractually the majority of these
deposits are able to be reallocated to future seasons'
bookings.
Despite the fact that Jet2.com had to suspend its flying
programme in mid-March due to the unprecedented travel restrictions
imposed by governments across Europe as a result of the spread of
the Covid-19 virus, in FY20 our Leisure Travel business still
achieved overall flown passenger growth of 14% to 14.6m and growth
in Package Holiday customers of 19% to 3.8m, representing 52% of
the overall mix of passengers flown, an increase of 3ppts.
Year ending 31 March 2021 (FY21)
The impact and duration of Covid-19 remains difficult to
determine, and the Board has no clarity as to how this will affect
Group profit before foreign exchange revaluation and taxation for
the financial year ending 31 March 2021.
In response, we have already taken many actions to underpin the
stability of our business and preserve cash. With our aircraft
fleet currently grounded, approximately 80% of our UK colleagues
have been put on temporary leave of absence ('furloughed') in order
to make full use of the grants available under the UK Government's
Coronavirus Job Retention Scheme (the "Scheme"). Similar schemes
are also currently in place for many of our overseas
colleagues.
From 17 June 2020, we are on sale with a reduced flying
programme and as a consequence have cancelled all 12 summer-only
third-party leased aircraft. In addition, non-critical capital
expenditure has been deferred, recruitment and discretionary
spending has been frozen, and contractors have been terminated.
Furthermore, we have also had positive discussions with many of our
suppliers to reduce our monthly outgoings.
Despite the Scheme, our monthly salary bill remains a
substantial proportion of our overall costs and therefore, with
huge reluctance and after much thought, we have asked all
colleagues (including Directors) to take a pay cut of up to 30% for
the 6-month period from 1 April 2020 until 30 September 2020.
Additionally, performance related bonuses earned for the financial
year ended 31 March 2020 plus the Discretionary Colleague Profit
Share Scheme, will not be paid. Finally, the Board deems it
inappropriate to recommend a final dividend for the year ended 31
March 2020 while making use of the Scheme.
We have prudently fully drawn down our Revolving Credit Facility
of GBP100m and have also begun the process to confirm our
eligibility and access to the Covid Corporate Financing Facility,
launched by the Bank of England. In addition, we remain in ongoing
constructive discussions with our existing liquidity providers, who
recognise the strength of our business model.
Positively, and despite the considerable uncertainty, we are
seeing customers still making bookings for late summer 20 and
winter 20/21, with encouraging numbers choosing to rebook rather
than cancel. In addition, and though very early, summer 21 bookings
to date are very promising.
Our Distribution & Logistics business, Fowler Welch,
continues to perform strongly, providing much needed and valuable
distribution services to the UK food industry supply chain.
The health and wellbeing of our Colleagues and Customers has
always been of paramount importance. We are therefore proud of the
extensive repatriation programme we conducted to bring our valued
Customers safely home, and how so many of our Colleagues have
responded quickly and positively to the new ways of remote
working.
We remain confident that once normality returns, our Customers
will be determined to enjoy the wonderful experience of a
well-deserved Jet2 holiday and that Jet2.com and Jet2holidays will
continue to have a thriving future, taking millions of UK
holidaymakers annually, to the Mediterranean, the Canary Islands
and to European Leisure Cities.
Further announcements will be made by the Board as circumstances
evolve.
For further information, please contact:
Dart Group plc Tel: 0113 239 7817
Philip Meeson, Executive Chairman
Gary Brown, Group Chief Financial
Officer
Cenkos Securities plc Tel: 020 7397 8900
Nominated Adviser
Katy Birkin/Russell Cook
Canaccord Genuity - Joint Broker Tel: 020 7523 8000
Adam James
Arden Partners - Joint Broker Tel: 020 7614 5900
Paul Shackleton/Daniel Gee-Summons
Buchanan - Financial PR Tel: 020 7466 5000
Richard Oldworth
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
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END
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