BARCELONA, Spain--(BUSINESS WIRE)--Since the start of the coronavirus outbreak in China, Fluidra has been monitoring the evolution of the situation around the globe. Their priorities are protecting the safety of employees and business partners, and ensuring they maintain the strength of the company.
To ensure this, Fluidra has put forward some initiatives in line with the recommendations from the authorities. A very significant part of the staff is working remotely. In production, logistics and other areas where remote working is not possible, split team arrangements have been made to reduce worker density and personal protection equipment has been provided. Even though some of the manufacturing sites have been temporarily closed, inventories have been spread across multiple geographies ensuring continued service to customers. Up to date, the coronavirus has not impacted the health of employees.
While Fluidra’s results up to February were off to a strong start, they have seen that confinement measures have slowed down business in some of the areas where they have been implemented. As a consequence, Fluidra is withdrawing its previously communicated guidance for 2020. The evolution of the situation is currently too unpredictable to accurately assess the full year impact of the pandemic. The company expects to communicate further information in its first quarter results presentation.
The pool and wellness industry serves close to 16 million residential in-ground pools globally, with this installed base creating a strong, resilient base of activity, both for the sales of equipment and water treatment products. According to several disease control centers the coronavirus cannot survive in properly treated pool water. In many parts of the world, cleaning pool water is considered an essential activity and the company’s teams continue working to support the customers.
Confinement measures will favor “stay at home” behaviors, which will support the aftermarket business as pool equipment will have to be maintained and replaced. Residential pool business and pool water treatment represents today 70% and 14% of Fluidra’s sales, respectively. On the contrary, the tourism industry is expected to face more severe headwinds due to COVID-19 with a consequent impact to the commercial pool business, which currently represents 7% of global sales.
Fluidra’s financial and liquidity position remain strong, with leverage of 2.6x at year-end. Fluidra has ample liquidity through its cash on hand, ABL, RCF, and other bilateral credit facilities. These latter facilities totaled €417 million at year-end, while they were only 2.5% drawn. As a reminder, the next term loan maturities are 07/2025 and there are no pending refinancing needs over next 12 months, while the ABL revolver maturity is 06/2023 and the RCF maturity is 06/2024. Furthermore, the company has no financial maintenance covenants on its term loans.
At a more operational level, Fluidra is actively working to implement several measures to ensure they maintain and reinforce the company:
- The Board of Directors has decided to put on hold any dividend distribution.
- The Board of Directors, the Executive Chairman and the CEO have agreed to lower their remuneration by 30% for this period. In addition, the management committee has agreed to lower their salary by 20%.
- The company has initiated temporary layoffs in various countries to adjust to the demand evolution and has decided to partially complement the workers’ salaries to soften the impact on their payroll. Such employment flexibility measures will be adopted in other geographical areas as needed.
- The company is reviewing its global operational expenditure to reduce discretionary spending as well as delaying lower priority capital expenditure.
- However Fluidra is ready for a strong season post the pandemic on all markets.
Fluidra is also contributing to support the community during this pandemic by providing hospitals with 3D printed and plastic-injected components for respirators and ventilators that are used at hospitals with COVID-19 patients.
Fluidra hopes for a swift recovery for all those affected by COVID-19 sending a special acknowledgment to the health professionals and others that are currently dedicating all their time and energy to protect all of us. Finally, Fluidra thanks all its employees, for their commitment and responsibility, particularly those who are still working on-site.
Fluidra, a Spanish listed firm, is the global leader in the pool and wellness equipment business. It provides innovative products, services and Internet of Things solutions. The company operates in over 45 countries and owns a portfolio of some of the industry’s most recognized and trusted brands, including Jandy®, AstralPool®, Polaris®, Cepex®, Zodiac®, CTX Professional® and Gre®.
To learn more about Fluidra, visit www.fluidra.com