Skyline Enterprises is cutting more than half of its 1200 staff as it restructures the group to cope with the Covid-19 pandemic.
The operator said in a shareholder update yesterday that following consultation with staff, it had confirmed its “new organisational structures”.
Exact numbers should be known within about three weeks.
“The result will be a significantly reduced workforce for the New Zealand operations in line with the expected diminished revenues from a primarily domestic market for the remainder of 2020 and into 2021,” company chair Jan Hunt said.
“These are challenging and difficult times for our people, their families, and the wider communities we operate in. We have committed to supporting our people and their incomes through this process, including utilizing the full provision of the government wage subsidy.”
Skyline Enterprises and Christchurch Casinos, the two largest parts of the group, took $4.44m in wage subsidy for 665 staff.
A similar restructuring was underway at Skyline’s international businesses, with only its Korean luge at Tongyeong operating at reduced volumes.
“In Singapore, the Government announced more restrictive public movement measures last week, and therefore the Sentosa Island luge business will remain closed through until to June 1st.
“This highlights the materially negative impact of Covid-19 on our businesses and the global and local travel and tourism industries. It will undoubtedly take some time for confidence and visitation to return.”
Skyline said New Zealand’s move to Covid-19 alert level 3 last week was encouraging but it did not allow its operations to open.
“Our current information tells us that we can expect only minimal domestic tourism activity at Level 2, and a partial opening of our New Zealand operations,” Hunt said.
“The wider discussion of a trans-Tasman bubble is positive, however we do expect very limited international visitation until 2021, as most countries, including New Zealand take a cautious approach to opening their borders again.”
The company was reviewing its capital projects and would put some on hold, although a final decision had not been made.
“Right from the outset of this challenging Covid-19 situation, your Skyline directors have sought and received detailed information and scenario projections on the short and medium-term financial future of the company,” Hunt said.
“The priority is to ensure that Skyline Enterprises continues to have a sustainable and resilient balance sheet that will enable fast recovery and future growth.”
It was “only prudent” to not declare a dividend for the March 2020 financial year.
“Our Skyline businesses have strong core fundamentals and form a unique and diversified product and geographic portfolio with broad customer appeal,” Hunt said.
“The measures we take now will protect our company, our brands, and revenues in New Zealand and around the world for the longer term.”
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