US – TransAct slashing wages and cancelling trade shows and promotionBy Phil - 30 March 2020
TransAct Technologies has announced a series of actions to enhance the company’s financial flexibility in response to the unprecedented uncertainty related to the impact the novel coronavirus (COVID-19) pandemic is having on the casino industry.
“First and foremost, the long-term health and well-being of our employees and their families, our customers, and the broader communities where we operate is our primary concern, and we have implemented robust measures in each of our facilities to keep our employees safe,” said Bart Shuldman, Chairman and Chief Executive Officer of TransAct. “We are taking meaningful action to mitigate the impact of the novel coronavirus (COVID-19) on our financial condition and successfully navigate the uncertainty ahead.”
The company’s original growth plan for 2020 called for increasing operating expenses to accelerate the growth of our Food Service Technology market. This included the full effect of headcount hired in Q4 2019, new hires already made in January and February of 2020 and additional planned hires for the remainder of the year, as well as planned increases in product development and other additional marketing initiatives.
In response to the novel coronavirus (COVID-19) pandemic we have postponed any further increases in spending and have implemented a number of cost reduction initiatives. We expect the actions that we are taking to reduce overhead and operating expenses by approximately $1.75m from our estimated Q1 2020 quarterly run-rate.
The cost reduction initiatives we are taking include a 10 per cent across the board salary reduction for all salaried, non-commissioned employees, a reduction in sales commissions for all commissioned employees and 10 per cent reduction of cash retainer fees for all non-employee directors.
It will also be furloughing approximately 10 per cent of its workforce and eliminating all discretionary spending such as trade shows, marketing and promotional activities, travel expenses, training, etc. wherever possible
“As a reminder, we recently announced a new asset based credit facility of up to $10m. This access to capital provides enhanced liquidity and flexibility for these unprecedented times,” Mr. Shuldman said.