Although a small proportion of Breedon's sites are still open, servicing critical supply needs during the COVID-19 pandemic, most are closed. In total, over 80% of the company's UK staff have been furloughed or temporarily laid off in the Republic of Ireland on full pay.
Headquartered in Breedon-on-the-Hill, Leicestershire, central England, Breedon said it plans to reopen some of its sites progressively "during the coming weeks" where there is customer demand and where the reopening can take place safely. This includes returning throughout May to clinker production at the group's two cement plants.
Breedon says it has been "encouraged" by recent announcements from several companies in the broader construction sector confirming their intention gradually to reopen their operations in several regions of the UK and Ireland.
The company says it has taken "disciplined action" to reduce its cost base and conserve cash, including the restriction of capital expenditure to critical and committed projects only, elimination of discretionary spending and tight management of working capital. Breedon has deferred 2020 pay increases, withheld the issue of 2020 bonus schemes and deferred long-term Performance Share Plan awards to executive directors and the wider leadership team. Breedon says it is also benefiting from the deferral of VAT payments and the reimbursement of a substantial proportion of the wages and salaries of furloughed and temporarily laid-off colleagues under the relevant government employee retention schemes.
Breedon Group's balance sheet remains strong. As of 30 April 2020, it had £79 million of cash and an undrawn committed facility of £222 million, compared with £60 million and £220 million respectively at 25 March 2020, which has enhanced its liquidity headroom. Breedon has also agreed with its banks a relaxation of its 30 June 2020 covenants and a deferral of £35 million of term loan amortisation to April 2022.
The group's annual general meeting, initially scheduled for Tuesday 21 April, has been rescheduled to Friday 22 May. It will be a closed meeting due to social distancing guidelines.
In other Breedon news, the group has also appointed a new non-executive director, Carol Hui. Hui's current directorships include Heathrow Airport Ltd, LHR Airports Ltd, Triumph Properties Ltd, and Robert Walters PLC.
