PG plc - Update on the Impact from ‘COVID-19’

On 18 March 2020, PG plc issued an announcement explaining how the current extraordinary events concerning the coronavirus ‘COVID-19’ are impacting the business of the PG Group. In this respect, the company noted that its supermarket operations constitute an essential component in the food supply chain of Malta which PG is duty bound to protect and maintain. A number of measures have already been implemented to protect the company’s various customers and staff, in full conformity with relevant Government guidance, and is also looking at measures that have also been implemented elsewhere. The measures taken to-date are various and numerous, including enhanced cleaning arrangements focused on all premises, trolleys, cash tills and other similar amenities; steps taken to reduce crowding, such as stocking of the supermarkets after closing hours and maintaining appropriate distances at cash tills and at queues; and ensuring, at all times, that the company’s staff are fully adherent to quarantine regulations.

PG added that it has also enhanced its on-line shopping resources to cope with the increased demand in this area, and the company is committed to continue enhancing this service to ensure that its customers’ needs are fully met. At the same time, PG’s two supermarkets – namely PAVI and PAMA – have remained well stocked at all times, supported by additional buffer stores, and were fully able to meet the peak demand caused by the precautionary buying that prevailed up to a few days ago.

In the short term, PG’s supermarkets operations will benefit from the increased home consumption enforced by the ‘COVID-19’ outbreak. On the other hand, however, the retail and retail mall operations have experienced a material adverse impact on revenues and, in this respect, PG has already taken steps to mitigate this adverse impact and has reduced its operating costs in these areas. Moreover, the company will continue to closely follow developments and take any corrective actions that may be deemed necessary for the duration of the current situation.

PG concluded by explaining that the longer-term impacts of ‘COVID-19’ cannot be predicted at this stage as much will depend on the extremity of the containment measures that may prove to be necessary, on the duration of the outbreak, as well as the economic conditions that will prevail, both in Malta and overseas, once the situation returns to normality. Nevertheless, the Board of Directors of PG is cautiously optimistic that the essential nature of the Group’s supermarket business, and the low gearing it maintains, will serve to contain the overall impact of the ‘COVID-19’ outbreak on PG. The Board of Directors will also keep the situation under constant review, and will issue further announcements as and when required.

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