Software firm Aveva to slash costs, but no plans for staff cuts
9 June 2020, 09:24
The technology company wants to save up to £60 million in costs this financial year.
Software company Aveva has said it has no plans to furlough or fire staff even as it tries to slash costs by millions to deal with the effect of the coronavirus pandemic.
The business said it was looking to save between £50 million and £60 million in the 2021 financial year as it deals with the fallout from the health crisis.
However, the company said it would not tap into Government support.
“At this point, Aveva does not intend to make staff reductions in response to the economic environment, furlough any staff, or make use of Government support programmes,” it said in a message to shareholders on Tuesday.
“Savings will be generated from reductions in discretionary spend, travel costs and lower costs from switching key events from physical to virtual.”
It buoyed investors, sending shares soaring by more than 6% at one point in the morning.
Meanwhile, the business reported that profits nearly doubled in the 2020 financial year, up to £92 million, on revenue of £833.4 million.
“I am very pleased with Aveva’s performance over the last year,” chief executive Craig Hayman said.
“Aveva’s team has adapted impressively to the current market and operating environment. The safety of our employees is paramount and I was very pleased that we managed to deliver a successful close to our financial year with 95% of employees working remotely.”
He added: “Looking forward, Aveva is well placed to navigate through the challenges of the current environment, with the benefit of recurring revenue from multi-year contracts.
“Aveva is in a strong position and our strategy and medium-term objectives remain unchanged.”
The company promised investors it would continue to pay out an unchanged 29p dividend.
It said that businesses have started to focus on digital technology, and cloud computing in particular, during lockdown while their staff work from home, which are all services offered by Aveva.