QT Perth is part of Event's 10,000-room hotel and resort portfolio. Photo: Supplied

Event CEO, board take pay cut as virus hits its hotels and cinemas

Larry Schlesinger|Mar 17, 2020

Event Hospitality and Entertainment chief executive Jane Hastings has taken a $200,000 annual pay cut as the hotel and cinema group, backed by billionaire Alan Rydge, comes under growing earnings pressure from the worsening COVID-19 pandemic.

Mr Rydge, Event’s chairman, and its non-executive board members all elected to forgo 20 per cent of their director’s fees over the next 12 months “in response to the current impact of COVID-19”.

The group added that it had initiated “several other revenue and cost savings measures” in response to the pandemic, but did not provide further details.

All of Event’s hotels, resorts and cinemas remain open, a spokesman confirmed.

However, with its business divisions so heavily reliant on tourism and discretionary spending, Event remains one of the most highly exposed listed real estate owners and operators in the country to COVID-19.

Ms Hastings’ voluntary pay cut comes after Event, which operates a 10,000-room hotel and resort portfolio and owns brands like QT, Atura and Rydges, said in February (as part of its half-year update) that it expected a $2 milllion to $3 million hit to its hotel earnings in just the month of March.

This it attributed to the “government’s travel restrictions and suspended airline services as a result of the coronavirus outbreak.

Based on the latest update, the outlook has worsened with the contagion spreading beyond Event’s hotels and resorts business to its 698-screen Australia and New Zealand cinema business. According to the Box Office Mojo website, Australia’s Box Office had its worst start to March in more than 15 years with total gross takings of just $4.2 million.

Blockbusters delayed

Event noted in its latest update the impact of COVID-19 had increased, “spreading to countries outside of China, further impacting the travel industry and disruption has occurred in the global cinema exhibition industry with several distributors delaying the release of major titles until later in the 2020 calendar year”.

Among the big blockbuster movies delayed is the next James Bond film, No Time to Die, which was due to be released next month, the next Fast & Furious movie (F9), Mulan and Peter Rabbit 2.

Ms Hastings, who earned a base salary of $1.4 million last year, said Event’s balance sheet remained strong, and while it was hard to predict how long COVID-19 would affect trading, she was confident the group would be well positioned to “return to growth once the impact has passed”.

“Given the dynamic and uncertainty of the COVID-19 outbreak, it is not possible to provide meaningful overall guidance for the group’s earnings for the second half of the financial year,” she said.

The coronavirus hit to the hotel sector has been well documented, with international visitor numbers plummeting and hotel booking cancellations soaring following travel bans on China, South Korea, Italy and Iran. A new 14-day self-isolation requirement for all arrivals to Australia is yet another blow to hotel operators such as Event and others.