NH publicly held companies adapt, some retrench, from coronavirus
First-quarter reports show most are taking a big hit
Furloughs, closures, some corporate pay cuts, virtual meetings and canceled guidance, are some of the actions the some of New Hampshire’s publicly traded companies disclosed in Securities and Exchange Commission filings over the last month in reaction to the coronavirus-induced recession that has slammed the nation.
Undoubtedly, more will be revealed as first-quarter reports emerge in the coming weeks.
The Exeter-based company, which makes equipment to treat patients suffering from respiratory distress, announced Monday that business has been booming.
It announced preliminary results that included an increase of 54% in revenue, to $18.9 million, for the first quarter, with gross margins of 47.6% to 48%, compared to 42.1% in the first quarter of 2019. It expects to have $60 million in cash on hand and is withdrawing guidance due to the significant increase of demand.
The fitness chain closed its gyms on March 18 as governors across the nation issued stay-at-home orders. On April 9, the company furloughed all of its in-store staff, except for corporate store managers. The company also said it would continue benefits of employees that were already getting them.
CEO Chris Rondeau has elected to forego 100% of base salary. President Dorvin Lively has taken a 30% pay cut, and chief financial officer Thomas Fitzgerald and chief information officer Craig Miller salary took 25% cuts. The base salaries of other senior management were reduced as well, and the board of directors waived annual cash retainers.
The company drew down $75 million under its revolving financing facility, increasing its cash on hand to $540 million as a “precautionary measure” and is withdrawing guidance.
Meanwhile, the company is doing the best it can to engage customers online. On April 1, New England Patriots wide receiver Julian Edelman lead a streaming workout. And on Monday, the company announced a partnership with iFit, a streaming home fitness company.
“Times are uncertain, and people’s daily routines have changed, but prioritizing your health is more important now than ever before,” said Rondeau, said in the release
On March 20, when the company first issued its proxy, it intended to hold a live shareholder meeting in Boston on April 30. But by April 6, it announced it would be a virtual meeting.
The Rochester-based manufacturer of engineering components announced that it has suspended production of composites for the LEAP aircraft engine at its plants in Rochester and Mexico. It also has halted operations of a facility in Salt Lake City after an employee tested positive for the coronavirus, but its larger facility there, which makes parts for the Lockheed Martin F-35 and the Boeing 787 Dreamliner, is continuing.
The company said there is “considerable uncertainty” in the company’s Machine Clothing unit, even though the products include materials used in a “wide variety of health and hygiene application.”
The company drew down $50 million on its existing credit facility, upping its cash equivalents to $220 million, and has access to another $200 million revolving credit line. It too is withdrawing its previous guidance, and announced that its May 14 meeting with will virtual.
VF Corp., which owns Timberland in Stratham and other outerwear brands like The North Face has closed all its retail stores and its office-based employees are working from home, with full pay and benefits for its employees.
In Europe, to access various benefits, it will pay 95% of wages for office-based employees and provide full pay for retail workers. Its stores in Asia, having passed though the pandemic earlier, are now open for business.
The company is doing business, online, however, so its distribution center works have been given extra emergency pay, and VF says it is implementing social distancing protocols, temperature screening, added protective equipment and reduced and rotating shifts and frequent cleanings.
The company is holding off on a share repurchasing program, drew down $1 billion from a revolving credit facility and says it has $2.4 billion of cash on hand. The company will offer guidance in May.