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QinetiQ Trading Inline With View; Postpones Dividend, To Cut Pay Amid Covid-19

Defence technology company QinetiQ Group plc. (QQ.L) Wednesday said it has continued to perform in line with expectations during the remainder of fiscal 2020, despite the impact of COVID-19. However, the company will postpone the decision to propose a full year dividend until later in the year due to the unprecedented nature of the virus.

The company has also taken various measures in the short-term to sustain its skills and critical capabilities for the long-term. These temporary measures include the CEO and CFO agreeing to a salary reduction of about 33% and the wider Board agreeing to a 25% reduction in fees.

In its trading update covering its fourth quarter to March 31, the company said the COVID-19 crisis is affecting all its key markets. The company will continue to monitor closely the impact on its business.

The company said it has a strong balance sheet and expects to end FY20 with about 60 million pounds of net cash available.

Looking ahead, QinetiQ said its customers are typically well-rated governments and at present do not anticipate the current COVID-19 situation to negatively impact their payment practices.

However, restrictions imposed by Governments internationally to counter the spread of COVID-19 will have an impact on revenues.

Steve Wadey, Group Chief Executive Officer said, "The business remains robust with good liquidity, a strong balance sheet and significant order backlog. However we believe, based on recent events, it prudent to implement a number of short-term actions to control cash outflow."

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