Mike Ashley’s Frasers Group has said its latest investor update, published only on Friday, “substantially underplayed” the effect the coronavirus will have on the retail sector – and is now cancelling its share buyback programme.
The group, which includes House of Fraser, said that “considering the actions that the government has taken since [its 20 March statement on Covid-19], and will most likely take in the coming days, the company has decided to suspend its share buyback with immediate effect”.
The announcement comes as the government increases its calls for citizens to stay inside and more shops pull down the shutters.
The buyback programme, launched under Frasers’ previous guise as Sports Direct International, was set as a maximum of £30m.
On Friday the group said it was “too early to estimate” the effect of the virus on its UK and international businesses, but that it expected “significant disruption” and that it would no longer meet guidance on EBITDA.
In its latest statement, the group said it would “continue to look at all options to maintain shareholder value and support”.
Shortly after 10am the group’s shares were trading down about 3.3% at 222.8p.
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