Brief: Mekonomen Updates On Data Breach And COVID-19 Impact

Meko AB

01/04/2020 07:45

April 1 (Reuters) - Mekonomen AB  MEKO.ST :
    * UPDATE ON DATA BREACH AND COVID 19 IMPACT ON MEKONOMEN
GROUP
    * ON CORONAVIRUS: THERE IS A SIGNIFICANT RISK OF FINANCIAL
IMPACT
DUE TO CORONA VIRUS (COVID 19)
    * ON MARCH 28, 2020 COMPANY BECAME AWARE OF DATA BREACHES
WITHIN
MEKONOMEN GROUP'S BUSINESS AREA MECA/MEKONOMEN
    * COMPANY BELIEVES IT HAS ADEQUATE BACK-UPS OF THESE SYSTEMS
AND
IS IMPLEMENTING ITS DISASTER RECOVERY PLAN
    * COMPANY ALSO BELIEVES THAT THEIR CYBER INSURANCE WILL
LIMIT
FINANCIAL DAMAGE DUE TO LOST REVENUE AND ADDITIONAL COSTS
INCURRED
    * BREACH HAS CAUSED EXTENSIVE DISRUPTIONS TO IT SYSTEMS
WITHIN
MECA/MEKONOMEN BUSINESS AREA IN SWEDEN AND NORWAY, WHICH IS ONE
OF FOUR BUSINESS AREAS WITHIN MEKONOMEN GROUP
    * OPERATIONS IN MECA/MEKONOMEN BUSINESS AREA WITH WHOLESALE
OPERATIONS, BRANCHES AND WORKSHOPS IN SWEDEN AND NORWAY HAVE,
UNDER CIRCUMSTANCES, WORKED WELL WITH FOCUS ON MINIMIZING IMPACT
FOR CUSTOMERS.
    * AS A RESULT OF COVID 19 PANDEMIC AND IMPACT OF DATA
BREACHES, IT
IS VERY DIFFICULT TO FORECAST PERFORMANCE OF COMPANY, BUT WE
ANTICIPATE A MATERIAL NEGATIVE IMPACT IN TRADING ENVIRONMENT FOR
REST OF YEAR
    * BELIEVES THAT AT THIS TIME IT HAS ADEQUATE LIQUIDITY, AS A
RESULT OF FAST-CHANGING ENVIRONMENT, COMPANY HAS BEEN EVALUATING
ITS LIQUIDITY AND BANK COVENANTS.
    * BELIEVES IT WAS IN FULL COMPLIANCE WITH ITS BANK COVENANTS
AS OF
31 MARCH 2020; HOWEVER, OUT OF AN ABUNDANCE OF CAUTION IT
PRO-ACTIVELY BEGAN DISCUSSIONS WITH ITS BANKING GROUP
    * BANKING GROUP HAS AGREED TO RAISE BANK LEVERAGE COVENANT
AS OF
31 MARCH AND POSTPONE COMPANY'S PLANNED AMORTIZATION PAYMENT OF
EURO 5 MILLION DUE 31 MARCH 2020.
    * COMPANY IS IN FURTHER DISCUSSIONS WITH ITS BANKING GROUP
REGARDING ADDITIONAL COVENANT RELIEF OR AMENDMENTS FOR FUTURE AS
WELL AS POTENTIALLY FURTHER POSTPONING AMORTIZATION PAYMENTS AND
EXPANDING ITS BORROWING CAPACITY
    * BREACH OF COVENANTS, IF NOT WAIVED BY BANKING GROUP, COULD
MEAN
THAT COMPANY MAY NO LONGER UTILIZE ITS CREDIT FACILITIES AND
COULD LEAD TO AN ACCELERATION OF REPAYMENT DATES OF CERTAIN OF
ITS BORROWINGS LEADING TO A LIQUIDITY SHORTAGE

Source text for Eikon:  ID:nWkr6vNyKY 
Further company coverage:  MEKO.ST 

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