Hargreaves Services PLC Deferral of Interim Dividend and Trading Update (6328H)
26 March 2020 - 6:00PM
UK Regulatory
TIDMHSP
RNS Number : 6328H
Hargreaves Services PLC
26 March 2020
Hargreaves Services plc
("Hargreaves" or the "Group")
Deferral of Interim Dividend and Trading Update
Hargreaves Services plc (AIM: HSP), a diversified group
delivering services to the industrial and property sectors, is
providing a trading update and notice of the suspension of the
proposed interim dividend in the light of the Covid-19
pandemic.
Since the announcement of the Group's interim results on 29
January 2020, trading has been in line with our expectations, with
no meaningful impact to date on the Group's trading activities as a
result of Covid-19. Nevertheless, the Board has considered
Government guidance in respect of Covid-19 and has determined that
it is not possible to assess the potential impact on the Group's
trading performance over any clear timeline. Against this
background, the Board considers it prudent to protect the Group's
cash position and management is focused on taking whatever steps it
can to minimise all discretionary expenditure, including capital
expenditure, and to reduce all other cash outflows wherever
possible. In doing so, the Board is seeking to maintain the Group's
trading activity and its level of service to its customers to the
maximum extent possible.
Accordingly, the Board has decided to defer payment of the
proposed interim dividend of 2.7 pence per share, otherwise payable
on 6 April 2020, until further notice and will review the Group's
future dividend policy once there is greater clarity on the likely
future impact of the pandemic on the Group's business.
Regarding market consensus estimates for the Group's future
financial performance, the Board considers that the uncertainties
surrounding many industries as a result of Covid-19 render it
impossible to provide any meaningful guidance.
As previously stated, the Group's current bank borrowing
facilities of GBP50m 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. The
Group has met all banking covenants and has no more measurement
points prior to 31 August 2020. As reported at 30 November 2019,
the Group had a strong balance sheet with net assets of GBP130m and
net bank debt of GBP25.4m.
Roger McDowell, Chairman said: "The Board's first priority will
always be the health and welfare of our employees and those with
whom the Group engages, and robust procedures are in place to
deliver that . Alongside those measures, the Board is taking all
practical steps to safeguard the financial position of the Group in
the face of this unprecedented and unpredictable global phenomenon.
In doing so, our challenge is to anticipate the possible condition
of the Group's various markets after the Covid-19 crisis and to
shape our future strategy and business plans accordingly."
For further details:
Hargreaves Services plc
Gordon Banham, Chief Executive
Officer
John Samuel, Group Finance Director 0191 373 4485
Buchanan (Financial PR)
Mark Court/Henry Wilson 0207 466 5000
N+1 Singer (Nomad and Joint Corporate
Broker)
Sandy Fraser/Justin McKeegan/Rachel
Hayes 0207 496 3000
Investec (Joint Corporate Broker)
Sara Hale/Cassie Herlihy 0207 597 5970
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END
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