Accesso Technology has today (Monday) permanently closed its San Diego office in order to reduce its operating costs after being “severely” affected by COVID-19 closures, with April revenues to be down by 72% YoY.
The London-listed firm, which provides virtual and online ticketing solutions and virtual queueing technology solutions for attractions, will reduce monthly operating cost run rate by approximately $2.6m compared to 2019, resulting in a run rate of approximately $3.8m during this period of reduced operations.
Accesso, which employs 568 staff, has cut 52 full time positions, 30 independent contractor roles, permanently closed an additional 14 open roles and placed roughly half of its remaining staff on furlough. It said in its announcement that the total staffing costs, inclusive of taxes and benefits, represented approximately 76% of the company’s overall operating expenses in 2019.
As a result of the various closures and postponements, transactional revenues, which in 2019 comprised approximately 73% of its total revenue, fell to close to zero and professional services have reduced as its customers seek to conserve cash. Accesso’s ongoing revenue consists primarily of support, maintenance and licence fees as well as recurring platform fees and the remaining professional services work.
Revenues for the month of April are expected to be down by 72% year-on-year.
The firm said despite the pandemic hitting its served markets severely, including its key North American market, the “great majority will rebound strongly, being leaders in their respective markets with significant latent demand and strong long-term customer propositions.”
Accesso noted most of the theme parks, attractions, and other venues in its client portfolio are regional in nature, meaning their visitors live within a short distance of the venue. A visit does not require significant advance planning, air travel or hotel accommodation.
It said due to this factor, demand for these venues is likely to rebound “strongly” even if visitors are required to stay close to home and will “likely increase as individuals seek leisure activities with their friends and families following an extended period of isolation.”
Steve Brown, chief executive of Accesso, said: “My priorities at this time are to ensure the health and safety of our accesso team; to reinforce our financial resilience and flexibility; to maintain the operational readiness of our business platform; and to ensure we keep focused on our long-term strategy for success.
“Having started the year strongly, we are now acting decisively to manage our cost-base while this situation endures. We have sufficient liquidity in place to manage a range of forward-looking scenarios, and we are considering further options to ensure the Company is fully prepared should the impacts extend beyond the range of our current expectations.”
The group’s net debt position was $10.5m, comprising cash at hand of $14.7m and borrowings of $25.2m against a committed revolving credit facility of $30m with Lloyds Bank, which is committed until March 2022. As a result, cash available to Accesso is $19.5m.
As announced in its preliminary results, the group said it had undertaken immediate cost savings measures including mandatory salary reductions across all US staff and voluntary salary reductions for non-US based staff, elimination of discretionary expenses and suspension of the company’s matching contribution to the 401K programme for US-based staff.
Meanwhile, Accesso has announced the appointment of Fern MacDonald as chief financial officer. MacDonald, who has served as senior vice-president of finance at Accesso since May 2018, also joins the board with immediate effect.