Bosses at Elland company agree to take 20 per cent pay cut

The board at Marshalls revealed that it had unanimously agreed to take an immediate 20 per cent reduction in its remuneration for the duration of the coronavirus crisis.

The specialist landscape products group has been supplying natural stone and concrete products to the construction, home improvement and landscape markets since the 1890s. It has supplied products to a number of famous landmarks, including Trafalgar Square.

Marshalls has issued a further update on the measures it is taking in response to the Covid-19 outbreak.

The statement said: “The group is continuing to monitor the current situation and is taking all appropriate steps to support the long-term interests of the business, its employees and other stakeholders.

“Marshalls has now implemented a detailed operational plan which includes the temporary cessation of certain operations across its manufacturing network.

“Our operational planning continues to be dynamic and capable of reacting to the changing environment.”

The company said it was closely monitoring cash flows to ensure that the business is in a strong position for eventual recovery.

Discretionary expenditure is being controlled and non-essential capital expenditure has been deferred, Marshalls said.

The statement added: “No actions are being taken at the expense of health and safety.

“The group is utilising the Government’s scheme which allows the deferral of tax payments that would normally have been payable in the period to June 30, 2020 and is also utilising the furlough arrangements that are now in place.

“With effect from April 1, 2020 until further notice, the board has unanimously agreed to take an immediate 20 per cent reduction in its remuneration for the duration of the crisis.

“The effect of this will be to reduce the salary of the executive directors by 20 per cent, including pension contributions, salary supplement and 2020 bonus payments which are calculated as a percentage of salary, and to reduce the annual fees of the chair and non-executive directors by 20 per cent.

“Other members of senior management have also voluntarily agreed similar reductions.”

Marshall said that its banking partners, NatWest, Lloyds and HSBC, continued to be supportive.

The statement added: “Each bank has confirmed its full support for an additional £30m, 12-month committed RCF facility to be provided.

“The discussions held have been positive and, subject to the finalisation of documentation, are now well advanced.

“We anticipate the documentation process to be completed by the end of April.

“These additional facilities comprise £90m in total and will strengthen the group’s headroom as we continue to manage the current situation.”

The statement added: “Including these additional facilities, the group will have total bank facilities of £255m of which £230m will be committed.”

Guidance withdrawn

Last month, Marshalls cancelled its final dividend and withdrew all previous market guidance in response to the coronavirus pandemic.

At the time, Marshalls said that the group had a strong balance sheet supported by a flexible capital structure and it maintains significant headroom against bank facilities. The company has achieved significant growth overseas in recent years.

Following the company’s expansion into Europe with Marshalls NV – which supplies products to Benelux, France and Germany – in 2012 Marshalls announced the opening of its China office in Xiamen, to service the Asian market.