- Automotive coatings company, Uni-Select Inc (TSX:UNS), is suspending its dividend and laying off staff due the COVID-19 pandemic’s effects on the industry
- The dividend suspension will come into effect after the next planned distribution is paid on April 21
- The company will temporarily lay off 50 per cent of its staff, with the remaining staff working reduced hours to help manage the recent low demand for automotive services
- Furthermore, the company’s executive management and board of directors is taking a 20 per cent and 25 per cent salary cut, respectively
- Uni-Select Inc (UNS) is down 3.53 per cent, with shares trading for C$5.20 and a market cap of $220.41 million
Automotive coatings company, Uni-Select Inc (TSX:UNS) is suspending is dividend and laying off staff, due the COVID-19 pandemic’s effects on the industry.
The dividend suspension is one part of the company’s effort to weather the pandemic’s effects on its operations. The dividend suspension will come into effect after the next planned distribution is paid on April 21.
While the automotive industry has been recognised as essential during widespread government-mandated shutdowns, demand for services has seen a steep decline.
As a result, the company is also temporarily laying off 50 per cent of its employees across its three businesses. The remaining employees will work reduced hours at a reduced number of store locations.
Furthermore, the company’s executive management team is taking a 25 per cent salary cut, along with a further 20 per cent cut to the board of directors’ pay packages.
Brent Windom, President and CEO of Uni-Select, believes these drastic steps are necessary, given the present challenges facing the industry.
“These important and difficult decisions were made by our team in a quick and nimble fashion, all within a very volatile environment, but always with the best interest of the corporation as a whole in mind.
“These decisions are being made to ensure that the corporation comes out of the COVID-19 crisis strong and ready to continue its plans for growth, overall performance improvement and value creation for its shareholders,” he said.
Brent went on to say that, in an effort to help out struggling government industries, the company has donated thousands of N95 respirators over the last week.
The company stated that it will further outline the COVID-19’s impact on its operations when it releases its first quarter fiscal 2020 earnings, around May 14, 2020.
Uni-Select Inc (UNS) is down 3.53 per cent, with shares trading for C$5.20 at 12:04pm EST.