Booking to reimburse $ 110 million in Covid aid to governments
Netherlands / United States: Online travel agency Booking Holdings has revealed it will reimburse up to $ 110 million in coronavirus aid to governments that have supported the company during the height of the pandemic . including approximately $ 78 million [€64 million] to the Dutch government over a salary dispute for the executives.
Booking announced that it would repay the aid in a filing with the United States Securities and Exchange Commission, including an amount of $ 78 million [€64 million] reimbursement to the Dutch government on an executive pay line. Booking.com, the company’s largest subsidiary, is based in the Netherlands.
Last week, the NRC newspaper in the Netherlands reported that three senior Booking.com employees at the holding company’s Amsterdam base had received some € 28 million. [$34 million] as bonuses last year, provoking angry reactions from Dutch MPs.
CEO Glenn Fogel and CFO David Goulden reportedly received $ 7.1 million and $ 24 million in compensation in 2020, respectively.
The company said, “While the decision to accept this aid was taken at a time when the business of the company was severely affected and the timing and pace of the industry recovery of travel were highly uncertain, the company is now encouraged by improving booking trends. . “
Booking defended the payments, which were mostly in the form of inventory, were up to industry standards and dependent on future performance, while Goulden’s salary included incentives for hiring and retention. job.
The company said it would make the reimbursements, despite the fact that the Dutch Minister of Social Affairs and Employment, Wouter Koolmees, said there was no legal basis on which to enforce the claim and that ‘it experienced an 80% decline in its activities at the start of the pandemic, and posting a Q1 loss of 165 million euros at the start of the year.
Booking.com spokesperson Leslie Cafferty said: “While we are not fully recovered, we have heard from the Dutch company and taken the considerations seriously. As we are in a more stable position than when we applied for the NOW [Dutch Covid state aid] program in early 2020, and on the road to recovery, we will reimburse the grants received.
Operating in a “very unpredictable” environment, Booking recorded an operating loss of $ 12.5 billion in 2020, marking a significant drop from operating profit of $ 6.6 billion for the year. former.
Last August, Booking.com announced it would lay off a quarter of its 17,500 employees due to the impact of the Covid-19 pandemic, which saw the brand report a 91% drop in gross travel bookings . It also chose to close five of its offices around the world, in Bellevue, Washington. [US], London and Cambridge [England], Toronto [Canada], and split [Croatia].
In its call for third quarter results for 2020, senior executives at Booking said they expect cancellation rates to drop further in November and December before a U-shaped recovery. [rather than the deep V shape seen earlier in the year] until spring 2021.
In addition to Booking.com, Booking Holdings also owns brands such as Kayak, Priceline, and OpenTable.