Hints of redundancies at TMC
Hogg Robinson Group (HRG) is "accelerating plans" to cut costs in its operation, it said in an interim management statement.
The move follows action earlier in its financial year to reduce costs.
The two actions are designed to save the travel management company £10m during its financial year.
This will include what the company said will be a "one off" cost of about £5m before tax "which will be taken as an exceptional charge in the second half of this financial year."
David Radcliffe, HRG's ceo, said: "We have already reduced back-office costs and are now taking action to re-shape other parts of our business so that we are in a position to exploit the opportunities when the trading climate picks up again."
In its statement, the TMC said it had traded "as expected" in the past four months and was "hopeful" of delivering full year results "in line with expectations."
It said it was winning more clients than it was losing and that corporates were still travelling though on less expensive options.
But it said revenue had dropped by 6% in real terms over the last four months.
HRG said that while it had paid an interim dividend last November, the board was not recommending that a final dividend be paid at the end of the financial year.
This will save approximately £8.6m in cash and "will strengthen the balance sheet significantly."
Mr Radcliffe said: "We are by no means immune to the current market conditions, but our business has held up well so far thanks to our diversified client base and strong cost control.
"We continue to retain our existing clients and are adding new ones regularly, but recognise the need to plan for the future based on a cautious outlook.
"In the current macroeconomic climate, it is difficult to predict with any certainty the outcome for the key fourth quarter of our financial year but, based on our performance to date, we remain hopeful of finishing the year in line with market expectations."
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