- No pre-tax profit since 2019
- Debt remains very high
Our stance on IWG (IWG) remains firmly bearish. The flexible workspace operator may have narrowed its pre-tax losses in its results for the last calendar year, but its net debt still easily outstrips its net assets.
The reason for this is that IWG’s business model is fundamentally flawed. It leases its buildings, while its competitors own theirs. So, although flexible office landlords like Workspace (WKP) make money by collecting rent from their office assets, IWG leases offices from landlords in order to sublease them to other companies on more flexible terms.