Travelex appoints David Frauman as independent non-exec director
Tony D’Souza (CEO) has agreed that his salary will be reduced by 50% and across the senior leadership team salary reductions will average approximately 20%.
Travelex Financing Plc today announces the appointment of David Frauman as an independent non-executive director of Travelex Holdings and certain other subsidiaries of Travelex.
Travelex believes that Mr Frauman’s extensive involvement in debt restructuring situations and previous Board experience will provide the Travelex Group with valuable governance support and expertise.
Separately, Travelex says it will be making use of the Coronavirus Job Retention Scheme in the UK to meet some of the costs of UK-based employees who have been furloughed. A significant proportion of other staff globally have volunteered for salary reductions from April 1, 2020. Tony D’Souza (CEO) has agreed that his salary will be reduced by 50% and across the senior leadership team salary reductions will average approximately 20%.
The outbreak of Covid-19 has led to the closure of most of Travelex’s Forex bureaux globally. These current closures, together with expected significant reductions in airline passenger volumes over coming months, are set to have a material negative impact on 2020 results.
In response, Travelex is implementing a wide range of cost control measures and working with its professional advisers to access various government support measures. Travelex has also approached the landlords of its major global locations, principally airports, and is in constructive discussions regarding rent relief.
On March 27, 2020, Travelex Financing Plc provided an update on the status of the business and the steps being taken to address the current situation. In line with an earlier announcement, Travelex Group reiterated that it has a legal and financing structure capable of operating separately, on a stand-alone basis, and recent board changes reflect this independence from Finablr PLC (LON:FIN) and its shareholders.
A week before that, Finablr representatives Dr BR Shetty, Binay Shetty, Abdulrahman Basaddiq and Promoth Manghat resigned from the Travelex board. These changes, Travelex noted, mean that there is no longer any overlap between the boards of Travelex and Finablr.
Travelex has also appointed an independent team of advisers to support the Travelex Group, separate to those appointed by Finablr, including Sidley Austin LLP as legal advisor and PwC as financial advisor.
Travelex also commented on covenant compliance. Based on unaudited management accounts TP Financing 3 Limited and Travelex Limited (the “RCF Borrowers”) complied with their Q4 2019 financial covenant requiring a Leverage Ratio at or below 3.48x. Let’s recall that Travelex estimated that there will be a reduction of Underlying EBITDA in Q1 2020 compared to the equivalent period of 2019, mostly attributable to the malware. The outbreak of COVID 19 has resulted in an increased number of airline cancellations and airport closures which is likely to worsen the position.
The Travelex Group said its view is that the RCF Borrowers are unlikely to comply with the required Leverage Ratio for Q1 2020.
