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24 March, 2020

Webjet, CTM and Experience Co. among latest ASX-listed companies to issue COVID-19 updates

By Travel Weekly

Scores of listed travel companies have been updating the market on their respective responses to the impact of the COVID-19 pandemic in recent days.

Aside from the usual suspects Qantas, Virgin Australia, Flight Centre and Helloworld Travel, here’s a recap of some of the other announcements that have hit the ASX of late:

Webjet seeks funding

After requesting a trading halt on Thursday, the online travel company requested a voluntary suspension for its shares yesterday as it continues to work on a proposed raising of funds.

Webjet is yet to conclude the terms of its proposed raising, and has requested to keep the voluntary suspension in place until announcing the outcome.

It has been reported by The Australian Financial Review that Webjet is seeking a $250 million equity injection, and was also considering an offer from private equity firm KKR.

CTM implements further cost-cutting measures

Further to its initial measures introduced to mitigate the impact of COVID-19, Corporate Travel Management (CTM) has commenced a round of cost reductions of at least $10 million per month, effective from the end of March 2020.

“Further adjustments to the cost base will be considered based on conditions,” the company said in a statement.

“Importantly, CTM’s operating model enables it to retain the capacity to quickly scale up when travel activity recovers.

“Regrettably, these actions include some redundancies and the support, understanding and loyalty of our staff is testament to the culture of CTM.”

The company has deferred the payment of an interim dividend to shareholders until 2 October 2020, but claims its liquidity position “remains strong and we have no current need to raise equity”.

Experience Co. halts operations

After reviewing advice from both the Australian and New Zealand governments in regard to non-essential services and social distancing, Experience Co. has suspended all of its operations indefinitely. The company said this decision will be reviewed on a weekly basis.

Furthermore, Experience Co. has not issued an earnings guidance for FY20, and noted that, given the significant uncertainty in market conditions, will be refraining from issuing any earnings guidance in the near term.

“Recent events are unprecedented for the tourism sector across Australia and New Zealand,” Experience Co. CEO John O’Sullivan (pictured above) said.

“We will continue to be proactive and mitigate the impact of these events on how we manage our business day to day.

“I am pleased to have a supportive board and committed workforce working in a measured approach to actioning contingency plans and navigating the business through these most uncertain of times.”

SeaLink suspends FY20 guidance

SeaLink Travel Group announced to the market on Friday that it currently has no material operational constraints in providing its services as a result of the COVID-19 outbreak.

However, the company has suspended its earnings guidance for the 2020 financial year, “given the ongoing uncertainty in the tourism market and difficulty of estimating the impact on second-half earnings or a timeframe for recovery for our tourism and marine services”.

SeaLink has also suspended its tourism dining and sightseeing operations on Sydney Harbour and cruises on the Murray River in South Australia.

Additionally, the company has scaled back of some of its discretionary touring and marine services in Australia, along with implementing cost reduction strategies across all of its businesses.

Crown Resorts revises operating conditions

Following statements issued by the federal and state governments in relation to the closure of all non-essential businesses, the Crown Melbourne and Crown Perth entertainment complexes have ceased gaming activities, along with food and beverage, banqueting and conference facilities other than for the provision of takeaway meals or meal delivery services (where determined).

Crown will continue to provide hotel accommodation in a reduced capacity.

Ardent Leisure shuts down SkyPoint

Ardent Leisure Group announced today that, as a direct result of the federal government’s most recent announcement regarding licensed and entertainment venues, it has temporarily ceased operating SkyPoint until at least 31 May 2020.

The move comes shortly after Ardent Leisure announced the temporary closure of Dreamworld and WhiteWater World.

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