26 March 2020 – suspension of dividend and trading update

The company has provided a trading update and notice of the suspension of the proposed interim dividend due to the Covid-19 pandemic.  Since the announcement of interim results on 29 January trading has been in line with expectations.  There has been no meaningful impact to date on trading activities as a result of Covid-19.  However, the company believes it is prudent to protect cash and management is focused on taking whatever steps it can to minimise all discretionary expenditure including capital expenditure.  The proposed interim dividend of 2.7p per share was due to be paid on 6 April 2020 but is delayed until further notice.  Uncertainties surrounding many industries as a result of Covid-19 mean it is now impossible to provide any meaningful guidance on performance moving forwards.  Current bank borrowing facilities of £50m are due to expire on 31 August 2020. Discussions are continuing with both existing and prospective new lenders to put in place appropriate facilities for the future.  All banking covenants have been met and there are no more measurement points prior to 31 August 2020.  As reported at 30 November 2019, net assets were £130m and net bank debt £25.4m.  The shares remain cheap and we keep our BUY rating.