(Alliance News) - International Personal Finance PLC on Wednesday cancelled its final dividend, a move which the lender said would save it GBP17.3 million.
Shares in the firm were 13% lower at 65.96 pence each in London on Wednesday morning.
The company, which had proposed a 7.8p final payout, is aiming to save costs due to the uncertainty caused the Covid-19 pandemic.
International Personal added: "While it remains too early to quantify the potential financial impact of the pandemic on our businesses, the group is taking a number of actions to protect liquidity through this period of uncertainty. Capital expenditure and 2020 salary increases (including those of our executive directors) are being deferred, costs are being reduced, and discretionary expenditure curtailed. Additionally, in response to reduced collections and in some cases tighter price caps, we have significantly restricted our lending across all of our businesses.
"Although largely unaffected through to the first half of March, collections in our home credit businesses are now being significantly adversely affected as tighter restrictions are imposed on the freedom of movement of individuals."
In Poland, Hungary and Romania, the company has largely suspended visits to customers.
In Mexico, where it also operates, the company has seen little impact from the virus so far.
The firm said it has a "strong balance sheet", with undrawn debt facilities of GBP203 million.
"Whilst the duration and magnitude of pandemic related changes is difficult to predict, we have undertaken liquidity stress testing on the business under various scenarios to assess the impact of a further deterioration in collections performance. This analysis demonstrated that, in response to the pandemic related changes, we can manage cash flows by reducing lending volumes to retain adequate operational headroom against our debt facilities," International Personal said.
The company is set to release a first quarter update on April 30.
By Eric Cunha; ericcunha@alliancenews.com
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Inter. Pers. (IPF)