Low & Bonar PLC Trading Update (7911K)
13 April 2018 - 4:00PM
UK Regulatory
TIDMLWB
RNS Number : 7911K
Low & Bonar PLC
13 April 2018
LEI213800CALFKOEL7N7P10
Low & Bonar PLC
Trading Update First Quarter
Low & Bonar PLC ("the Group"), the international performance
materials group with leading positions in niche industrial markets,
today issues a trading update for the period since 30 November
2017.
Group revenue has increased in the first quarter of the year,
despite challenging market conditions in Europe and the USA, led by
growth in both the Building & Industrial and Interiors &
Transportation businesses albeit with a slightly unfavourable
product mix. Raw material cost increases have had a negative impact
in the first quarter and actions have been taken to mitigate these
through increased selling prices, although the benefit of this is
likely to be realised in the second half.
The actions from the first stage of the Civil Engineering review
are being implemented:
- the Ivanka site ceased production at the end of March, as
planned, and the process to sell assets and inventory is
underway;
- the Enkamat business is being transferred to the B&I
division, although it will take some time to be fully integrated;
and
- a new management team has been in place since 1(st) March to
lead the remaining parts of the Civil Engineering business,
Needle-Punched Non-Woven and Construction Fibres with a focus on
improving performance.
As previously stated, the outcome of the second stage of Civil
Engineering business review will be announced at the time of the
Group's interim results in July.
Initial progress has been made on solving the production
consistency issues in Coated Technical Textiles, however there is
still further work to be done and a new management team is in place
to deliver this. More generally within the Group, cost saving
initiatives have been commenced which should provide the Group with
a more effective operational structure.
Actions to strengthen the balance sheet have commenced and a
renewed focus on working capital improvement is being embedded in
the organisation from which we continue to expect to see benefits
this financial year. As part of this programme, production at some
manufacturing sites has been reduced in order to better manage
inventory levels, which has had a negative impact on cost
recoveries. As expected, the level of working capital and overall
Group financial leverage will increase in the first half as part of
the normal seasonality of the business.
In light of the above factors, whilst the Board's expectations
for the full year remain unchanged, it expects the Group's
financial results to have a much greater weighting to the second
half than in the prior year. The Board is confident that it is
taking the right actions to improve performance and create a strong
long term growth platform for the Group.
For further information, please contact:
Low & Bonar PLC
Philip de Klerk, Group Chief Executive 020 7535 3180
Instinctif Partners
Matthew Smallwood 020 7457 2020
Helen Tarbet
Rosie Driscoll
Forward-looking statement
This announcement contains certain forward-looking statements
with respect to the operations, performance and financial condition
of Low & Bonar PLC. By their nature, future events and
circumstances can cause results and developments to differ from
those anticipated. Nothing in this announcement should be construed
as a profit forecast. No undertaking is given to update any
forward-looking statement whether as a result of new information,
future events or otherwise.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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