The period July through September continued to be characterised by the negative impact of the corona pandemic on the entertainment and experience industry. During the quarter, net sales from operations totalled SEK 31 million (146), a reduction of almost 80%, which reflects the industry's predicament under the severe restrictions imposed by the authorities. During the quarter, our focus was on preparations for reopening several venues, managing the strained liquidity situation and creating a more flexible cost base to render operations more efficient in the future.
A WORD FROM THE CEO
Up until February, the year began strongly with an operating profit greater than last year. This has changed over the past seven months with the Group now reporting an accumulated operating loss of SEK -152 million, which is SEK 74 million greater than the previous year, which is due to the closure of the Group's operations as a result of the restrictions. The operating loss for the quarter totalled SEK -68 million (-27), which is SEK 41 million greater than the same period last year. The operating loss includes impairment charges for goodwill in the amount of SEK 20 million, which gives an adjusted EBIT of SEK -48 million. During the quarter, support in the amount of SEK 8 million was recognised as revenue under other operating income.
Since March, intensive efforts have been ongoing in Moment Group to parry the negative effects Covid 19 has on the Group. With the exception of our two activity arenas Star and Ballbreaker, virtually all activities have been closed as a result of what can almost be termed as a ban on trade. A purchase and investment freeze has been in place since March, and intensive efforts to reduce the weight of costs have been progressing in parallel with the implementation of short-term furloughs and large-scale redundancies. The support packages that were available were applied for to the extent to which we are eligible, and ongoing negotiations with landlords have led to limited success, in an attempt to minimise rental costs for premises and venues that have not been open due to the restrictions. Despite all these measures, liquidity in the company has been under severe strain, and to avoid liquidity shortages, it would have been necessary for the level of activity in our operations to have normalised gradually from the end of the third quarter, 2020.
Intensive negotiations with bond holders, investors and shareholders were held and are still ongoing to ensure access to working capital both to secure short-term liquidity and find a solution for the company's long-term financing.
While managing operations and securing liquidity in order for the Group to survive the pandemic, management groups in all operations are also working intensively to identify and delineate the right strategies and plans for the post-corona period, where the focus will be on building on the essentially strong and healthy businesses that make up the Group.
We are also concentrating on pursuing meetings with various politicians and authorities where we describe with great clarity the urgent situation we and our entire industry is having to deal with, with the aim of getting the government to make urgent decisions on contextualised restrictions and relevant support to the appropriate extent and at the right time, which is crucial for the survival of the event industry.
Gothenburg 26 November 2020
pro tem CEO/Group CEO
+46 708-64 55 04
This disclosure comprises information that Moment Group AB is obliged to disclose according to the EU market abuse regulation. The information was submitted through the offices of the above-mentioned contact, for publication on 26 November at around 19:40 CEST.
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