GVC Holdings, the parent company of UK operators Ladbrokes and the Coral family of sites, is taking drastic measures to help mitigate the economic fallout from the worldwide COVID-19 outbreak. Among the reported actions are the withholding of rent to landlords on its retail sites and the suspensions of dividends to its shareholders. The severity of these actions illustrate the seriousness of the situation that gambling operators across the world are facing as nearly every “non-essential” retail and entertainment establishment on the planet is shuttered over health concerns.
As of this writing, GVC Holdings has been forced to furlough approximately 14,000 employees and has temporarily halted operations at its 900 land-based UK operations.
The move to temporarily suspend rent payments on GVC Holdings’ retail spaces is not unexpected. Sky News reported on the action late last week. A GVC Holdings spokesperson confirmed the action saying, ” In view of the enforced closure of all Ladbrokes and Coral betting shops in line with government guidelines, GVC has taken the difficult decision to temporary place on hold rental payments to its landlords. In view of the enforced closure of all Ladbrokes and Coral betting shops in line with government guidelines, GVC has taken the difficult decision to temporary place on hold rental payments to its landlords.”
This week, GVC Holdings announced that it would not be paying out a dividend to its stockholders on April 23 as had been expected. Company officials indicated that the savings from the withheld dividend would be used to help it weather the COVID-19 crisis.
GVC Holdings’ handling of the crisis seems to be sitting well with traders as the company’s shares rose 18 percent on Monday.