Infrastructure services group Kier has published an update on how it has been affected during the Covid-19 outbreak.
The company says that in light of Covid-19, “the process to dispose of Kier Living and the evaluation of the options for our Property business have both been paused”.
Although Covid-19 has created uncertainty, because Kier operates across sectors that are vital to the country there has been no material change to its figures, it says.
The group’s varying activities include maintaining highways, carrying out vital maintenance to people’s homes, supplying FM services to the NHS, building schools and hospitals, and delivering critical national infrastructure and key maintenance and repair services to the water, gas, power, telecoms and rail sectors.
The update states: “Many of these services have government support and we retain key worker status for a number of our employees who are carrying out these activities. For the year ended 30 June 2019, c.73 per cent of our core Construction and Infrastructure Services activities related to work for government departments or quasi-governmental entities (for example, HS2 or Network Rail) and a further c.13 per cent related to the provision of services to regulated entities (for example, in the utilities sector). There has been no material change to these figures during the current financial year.”
It adds: “Trading from 1 January 2020 to date has been in line with the board's expectations. Approximately 80 per cent of our sites or workplaces continue to operate (subject to the pause referred to above), although we recognise that this may change. We continue to receive support from our major customers, including Highways England, the Ministry of Justice and various utilities providers. In line with a number of other companies in the sector, we will pause work on our Kier Living housebuilding sites."
The group continues to closely manage its net debt, which remains in line with management's expectations. The group has total facilities of about £910 million, including about £700 million of facilities, which are due for renewal during 2022. For the six-month period ended 31 December 2019, average month-end net debt was £395 million.
A Kier spokesperson said: “On the 22 March, we confirmed a number of measures taken by the group in response to Covid-19, including the early closure of Tempsford Hall and the executive committee taking a three-month reduction in their base salary. On the 27 March, we announced that further groups of employees would also take a three-month salary reduction, ranging from 7.5 per cent to 20 per cent dependent on their grade and our executive directors would take a 25 per cent salary reduction during this period.
“All operative employees whose work is essential in delivering vital infrastructure and services to our clients and customers, including maintaining the UK’s highways, providing FM services to the NHS and delivering works in the water, gas, power, telecoms and rail sectors, are exempt from this measure, which has been taken to ensure the group is able to operate as efficiently as possible in these unprecedented circumstances.”