Trading update reveals details of cost-cutting measures as listed firm points to 'protracted' uncertainty
Listed international firm Ince has laid off 50 lawyers and support staff in response to the Covid-19 pandemic and is looking to make further cost savings in the medium term by reviewing office space across its entire network.
The measures are revealed in an AGM statement and trading update published today that also confirmed that dividend payments remain suspended in the light of the pandemic’s impact on business.
The statement said a “limited global programme” of redundancies had taken place affecting lawyers and support staff “in areas where it is not expected that business will recover sufficiently in the medium term” from the Covid-19 pandemic.
And, in recognition of the fact “that working practices are likely to change over coming years” and that its current office space “may be too large or may no longer be suitable” it noted that it had the opportunity to make “significant further operational cost savings” in the medium term.
“In this context, investors should note that the group's material long term property commitments all have an opportunity for a tenant's break within the next three years,” the group said.
The statement added that trading for the first five months of the financial year to 31 August was ahead of the same period last year, with all of its overseas offices achieving improving margins and positive contributions to the group.
However, it revealed its UK arm “has not performed as well as the impact of Covid-19 has limited activity in, particularly, the aviation, real estate and corporate sectors, in part offset by more stable levels of activity in both shipping and dispute resolution”.
Last year the UK accounted for £63.9m (65%) of its annual revenue of £98.5m, with Greater China generating £19.6m (20%) followed by Dubai (£4.9m, 5%).
The statement said a recent tightening of Covid-19 restrictions in the UK in response to a sharp increase in infections had “now increased uncertainty over a more protracted period”.
Cash projections, meanwhile, were in line with previous forecasts with net debt at 31 August having reduced to £8m from £9m on 31 March with the group’s position expected to start to improve from Q4 onwards.
The group narrowly missed out on its revenue target for the last financial year with revenue of £98.5m, just shy of the £100m target.
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