Specialist regeneration developer and investor U and I Group has suspended its dividend and is not proposing any dividend for full year 2020.
The company said it would preserve £4.4m of cash by not declaring a final dividend.
The group’s development timelines have been massively impacted by closures during the covid-19 pandemic. It now expects to achieve £16m of gross development and trading gains in FY2020 against a target of £35m-£45m.
It said all non-essential development expenditure has been stopped or deferred improving cashflow by £30m over the next 12 months, while all discretionary spend has been eliminated.
On its investment portfolio, the group had collected 51% of rents due, as at 8 April 2020. A further 33% is under deferment negotiation with 16% outstanding.
The group said it has in excess of £45m of free cash and £26m of restricted cash, including £15m cash to be drawn against previously uncharged assets.
The group estimates that, post March, it could withstand a further fall in overall capital values of the assets in its investment portfolio of around 25% before requiring renegotiation of loan to value (LTV) covenants with lenders.
Cost saving measures taken by the company include a 50% pay cut for executive directors, 25% for non-executive directors and the group is consulting with all senior staff about a 10% reduction. All bonuses have been cancelled or waived.
It is also making a round of redundancies and furloughing 17 members of staff, saving the company £1.4m on an annualised basis.
UAI : U and I Group suspends dividend amid halt in development