Distributor Hills has introduced cost-cutting measures to help keep the company afloat amid the ongoing Coronavirus outbreak.
The biggest reductions came in the form of a company-wide staff salary reduction instead of standing down some employees with the aim of preserving as many jobs as it can.
“Like many other Australian businesses, Hills has been forced to take exceptional measures to help manage cashflow through the pandemic and meet our goal of preserving as many jobs as possible,” Hills’ ASX announcement read.
Effective 1 April, staff from both Australia and New Zealand will get graded salary reductions, with those on the lowest salaries being asked to take a 10 percent pay cut while those on the highest salaries take a 35 percent cut.
The company’s board has also agreed to take a 50 percent pay cut for all non-executive directors’ fees.
Other measures include temporary relief of rental costs negotiated with Hills’ landlord; deferring all non-essential capital expenditures and reducing “various” overhead costs; keeping inventory replenishment limited to fast-moving items; and to adjust pricing to compensate for the decline in the Australian dollar.
“While trading conditions will impact near-term operations, Hills believes the initiatives outlined best positions the company to navigate this period of disruption and the COVID-19 recovery phase as it will be important to emerge from this global health pandemic in a strong competitive position,” Hills' announcement read.