By Powerscourt on 18/03/2020

Powerscourt Coronavirus Briefing – 18 March 2020


Businesses and stock markets responded positively to the rescue packages announced on either side of the Atlantic yesterday. The Dow Jones Industrial Average finished up 5.2 percent, but continued volatility seems certain.

Business leaders welcomed the UK Chancellor’s package of interventions – a heady mix of guaranteed loans, grants, temporary tax cuts, repayment holidays, and regulatory relaxation – but there are concerns that certain groups have been omitted from Government thinking, including the self-employed and renters.

The business community seems united in its determination to ‘do its bit’. If Powerscourt’s clients are any guide, many large enterprises are exploring how they can make a contribution, whether by re-purposing their supply chains, re-directing their staff or through smaller scale gestures.

Sixty engineering firms engaged with the Government yesterday on the country’s most acute need – ventilators; though at present the preference seems to be to meet the need through other means.

The potential toll on manufacturing jobs was laid bare when Nissan sent workers home for an indefinite period yesterday. In retail, hundreds of Carphone Warehouse and Laura Ashley stores are to close, although the current crisis is only partly responsible.

Supermarkets are starting to introduce rationing to prevent stockpiling while Amazon says it will be restricting itself to essential items only.

The Government and the insurance industry seem to be on a collision course with the ABI saying that most policies do not cover small businesses for current loss of trade.

While most of us are relying on scientists to understand how Covid-19 is spreading, bankers are getting on the act. JP Morgan said on Tuesday that it expects active cases of Covid-19 in Italy to peak in the next seven days with the peak in the other main European markets set for late March.



Powerscourt is tracking how the UK population views the Government’s handling of the coronavirus pandemic. Over the weekend we saw opinion consolidate into two clear camps – those who think the Government is getting it ‘about right’ and those who believe it is not going far enough. There is a sharp decrease in those who say they don’t know. For now, the Government has the support 45 per cent of respondents while 40 per cent believe it should go further and faster. The next poll will take into account the financial rescue package announced by the Chancellor on Tuesday.

If there is a question you would like to add to the survey, please contact Powerscourt’s Head of Insight Anna McAvoy – anna.mcavoy@powerscourt-group.com. There is no charge but only one or two questions can be accommodated in each wave and the results will be published.







Consumer and Retail


The Group published a current trading and COVID-19 update stating that they were “facing unprecedented challenges”. The Group said it was taking “appropriate action to mitigate the impact” to staff and customers and in line with local government advice temporarily closing stores in a number of countries. Therefore, Superdry said that “it has become clear that the Company will not meet the guidance given on 10 January 2020. Accordingly, the Company is no longer giving formal guidance in relation to the financial year 2020.”

Greencore Group

The company provided an update in light of recent developments regarding COVID-19. The Group said that it was “trading broadly in line with original expectations.” Greencore said that from a demand perspective, “Group volumes are holding up well” but it was too early to predict the impact of coronavirus on FY20 results.


The online retail giant is temporarily stopping shipments sending non-essential items to its UK and US warehouses until 5 April, to focus on sending vital items needed by its customers during the coronavirus outbreak. The company is prioritising five categories of goods which it calls essential products, and which shippers can continue to send to its warehouses – these include baby products, health and household; beauty and personal care; groceries; industrial and scientific; and pet supplies.

Revolution Bars Group plc

The leading UK operator of premium bars said in very recent days the Group had faced a decrease in LFL revenue following increasing impact of COVID-19. Following recent government advice, the Board said it “expects a material deterioration in trading performance for the remainder of the financial period ending 30 June 2020.” Therefore, to mitigate the impact and preserve cash the business was taking action to remove cost and non-critical capex. Additionally, the statement said that the “Group welcomes the Government’s support for the business rates holiday for 12 months announced late yesterday, but this does not go nearly far enough and we hope that there will be further measures in the coming days to provide assistance with payroll entitlements to gain surety for our employees, amongst other things”.

The Restaurant Group

The Group said in a statement it had been reviewing the rapidly evolving situation relating to Covid-19 and has “modelled a scenario of the potential financial outcome in the coming months”. The Company provided guidance on the potential impact on their FY results including an overall decline in Group like-for-like sales of 25% in FY2020 (assumed down 45% in the first half and 5% in the second half).

Wynnstay Group

The manufacturer and supplier of agricultural products announced that it will be holding its AGM next week, but as a result of COVID-19, the board was adopting a number of changes to the traditional running of the AGM. These measures include condensing the format, no management presentation but instead a webcast, access to the Board following the formalities of the AGM will be curtailed (available for request via telephone for shareholders with queries), no refreshments served, and the number of external guests strictly limited. Shareholders will be able to exercise their voting rights at the AGM without physical presence by using proxy voting which they strongly encouraged rather than attend the AGM in person.




Nissan said in a statement yesterday that vehicle production had been suspended at their Sunderland factory, Britain’s biggest car plant. They have struggled with drop in demand and problems getting parts from China. “Further measures are currently under study as we assess supply chain disruption and the sudden drop in market demand caused by the Covid-19 emergency.” It is not clear how long the halt in production will last, but for the moment staff will continue to be paid.

Nexus Infrastructure

The company confirmed that results for the Group for the year to date are in line with its expectations.  The business said, that “while it is too early to determine what the short-term impact of the COVID-19 outbreak and market uncertainty will have on the UK economy and construction industry, sales activity on the Group’s sites currently remains strong. The Board is monitoring the situation closely and will provide a further update should there be an impact on the Group’s operational or financial position.”



Micro Focus

The software and information technology business provided an update on COVID-19 in regard to their dividend. The Group announced that the Board is no longer recommending a final dividend for the year ended 31 October 2019 due to the content of the current increased macro uncertainty. The statement said that there had been “no material impact” on the business to date but that the “ultimate impact on the global economy is unknown.” Micro Focus also encouraged shareholders to appoint the Chairman as their proxy (either electronically or by post) with their voting instructions rather than attend their upcoming AGM in person.



Rishi Sunak promises £350bn emergency rescue package for business – Financial Times 

Global rally loses steam as European stocks fall – Financial Times

 Powers to force coronavirus tests will be signed off without a vote – The Times

Coronavirus: Renters ‘need more help’ in UK’s plans – BBC