By Powerscourt on 22/03/2020
Powerscourt Coronavirus Briefing – 22 March 2020
ANALYSIS
The UK’s Financial Conduct Authority (FCA) has written to all listed companies asking them to observe a moratorium on the publication of preliminary financial statements for at least two weeks. “The unprecedented events of the last couple of weeks mean that the basis on which companies are reporting and planning is changing rapidly,” said the FCA in a statement yesterday (21 March). The practice of issuing preliminary financial statements in advance of the full audited financial statements is adding unnecessarily to the pressure on companies and the audit profession at this moment, the regulator said.
WHAT ARE COMPANIES SAYING?
Consumer and Retail
Amazon
A message to employees from CEO Jeff Bezos emphasises his personal dedication to the crisis. “My own time and thinking is now wholly focused on COVID-19 and on how Amazon can best play its role. I want you to know Amazon will continue to do its part, and we won’t stop looking for new opportunities to help.” The message also highlights that the company is hiring 100,000 new roles and raising wages for hourly workers. It outlines some of the changes the company has made in terms of logistics, supply chain and purchasing, and highlights the safety measures in place for employees.
John Lewis & Partners
The department store yesterday announced that it would be temporarily closing all 50 shops at close of business on Monday. The statement notes that this is the first time in its 155 year history that the doors will be closed. Chairman Sharon White said “the welfare of our customers, communities and partners is always our absolute priority” and gave thanks to each individual partner. The statement also lays out the steps being taken to protect the partnership’s liquidity, which include “significantly” scaled back investment in 2020 which had been anticipated to be £500m.
LVMH
The luxury goods conglomerate, which has already turned its perfume factories into hand sanitizer production units, announced yesterday that it will supply “several million” surgical masks in France. France, like many countries, is facing a mask shortage. A press release on its site reads: “By virtue of its global distribution network, LVMH has managed to secure an order with a Chinese industrial supplier for a delivery of 10 million masks in France in the coming days (seven million surgical masks and three million FFP2 masks). The order will be repeated for at least four weeks in similar quantities (ie approximately 40 million masks).”
Pret a Manger
In a message to customers, Pret CEO Pano Christou announced that all UK shops would be closing temporarily, effective from yesterday evening. He described the company’s “first value” as “Happy Teams, Happy Customers”. He used the statement to thank his staff, note the 100,000 NHS workers Pret has served in recent weeks, and reassure that excess food would go to “those who need it”.
Primark
The Sunday Times reports that Primark has cancelled all orders yet to reach its distribution centres, a move described as ‘devastating’ for its suppliers. The paper quotes CEO Paul Marchant as saying “We are deeply saddened that this will clearly have an effect throughout our entire supply chain.”
Industrials
Smiths Group
Smiths, the engineering group, announced that it will be “ramping up production” of its ventilators. In addition to its own production, Smiths will provide IP and technical advice to a government formed industrial consortium, to allow for additional UK sites and supply chains to help deliver the government’s plan of 5,000 additional ventilators within 2 weeks and 30,000 in the coming months. CEO Andrew Reynolds Smith said “During this time of national and global crisis it is our duty to assist in the efforts being made to tackle this devastating pandemic and I have been inspired by the hard work undertaken by our employees to achieve this aim.”
IN THE NEWS
NHS enlists all English private hospitals to treat coronavirus Financial Times
British Airways faces bailout as coronavirus crisis engulfs airlines The Times
Self-employed need financial help, unions warn BBC
