You all will be well aware of the growing concerns around the COVID-19 virus. While we as a company are monitoring the situation very carefully, our stance remains: “business as usual, while taking the necessary precautions”.
All of our construction sites are fully operational and to date we have minimal disruption. The management team has been in consultation with industry experts, and the overall consensus is that the property development division of the business should remain largely unaffected from a delivery and output perspective. We have fixed price JCT contracts in place with our building contractors supported by insurance warranties. It would be unrealistic to believe that there would be no interruption to the build schedule, however there will be very little financial impact on the schemes.
Our hospitality business, which forms less than 10% of our turnover and profit, will understandably be affected. The company’s growth strategy within the hospitality sector of the business, was to acquire, refurbish and relaunch its bars restaurants and hotels. The Group carries very little bank debt within its hospitality business which makes it much less susceptible to a downturn in the market. Talks are currently underway with government to make some of the hospitality venues available as hospitals and emergency facilities, should the need arise as a result of this virus. The board has also committed that in the event of a total forced closure of our venues, all remaining food and drink stock will be donated to support communities.
The risk posed to the economy is expected to have a much smaller impact than the 2008 financial crisis. Emma Wall who is the Head of Investment Analysis at Hargreaves Lansdown, a FTSE 100 company, states that: “Investing is all about the medium to long-term and over that time scale coronavirus is not going to have an impact.”
I would like to reassure our investors that we value your input and we encourage you to get in touch with us should you have any concerns or would like more information on the High Street Group.
Gary Forrest – Chairman
High Street Group
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