MONTREAL — SNC-Lavalin Group has announced actions in response to the COVID-19 economic disruptions.
The COVID-19 pandemic has impacted the company’s worldwide operations to the extent that the 2020 financial outlook that was provided by the firm on Feb. 28 is no longer valid, noted a March 27 release.
“The company has and will continue to take all appropriate actions to protect its staff, to maintain business operations for customers where allowable and possible, and to preserve liquidity. In doing this, we are following the latest health and safety measures and guidelines issued by the World Health Organization and home country governments,” the statement said.
In one measure announced, SNC-Lavalin’s executive leadership will be taking a 20 per cent reduction in salary and board members will take a 20 per cent reduction in cash compensation for the second quarter.
“As a global organization we are doing our utmost to protect the health and safety of our workforce and have enacted robust business continuity plans for our customers,” said Ian L. Edwards, the firm’s president and CEO. “I can’t thank our employees enough for everything they are doing for the company and its customers. We are actively managing the emerging impact on our business to minimize disruptions to our service delivery where possible, while taking actions on costs and cashflow with immediate effect to maximize their impact in the second quarter — and will stand ready to take further action if the situation demands.”
Most of the SNCL Engineering Services personnel have been able to continue servicing clients from non-office-based locations, and to transition work among different jurisdictions as required. The company continues to provide services to customers and governments in the regions it operates. It is also closely monitoring the situation with regard to LSTK infrastructure projects and will implement government and client instructions around ability to work as required.
In response to the emerging economic disruptions and impacts from COVID-19, the firm’s management is undertaking measures to align the cost base of the company to deliver cost savings into the second quarter, the release stated. The measures are focused on reducing costs and managing cash flow across the company to provide flexibility in addressing varying levels of revenue and customer business.
Discretionary expenditure not required to directly support client delivery is being significantly reduced, and capital expenditure frozen. Where it is not possible for employees to carry on productive client work, either due to temporary shutdowns or the nature of the client service, remedial actions are being taken, including reduced hours and employee furloughs.
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