12th Jan 2022 10:54
(Alliance News) - Shares in Accrol Group Holding PLC dropped nearly 20% on Wednesday morning in London, after it lowered guidance for annual revenue on Wednesday.
The Lancashire, England-based tissue converter now expects revenue to grow by just 17% to GBP160 million in the financial year that ends on April 30 from GBP136.6 million in financial 2021. This is a downgrade from October's more optimistic projection of 25% growth.
Earnings before interest, tax, depreciation and amortisation are expected to almost halve, with financial 2022 estimates at roughly GBP9.0 million, down from GBP15.6 million the year before. Accrol expects to recover its margin in the following financial year.
Accrol's share price dropped 18% to 25.12 pence each on Tuesday morning in London.
Since October, there has been further upward pressure on input costs such as pulp prices, as well as supply chain and energy costs, the company asserted. In response, Accrol has implemented more cost efficiencies, and increased customer prices from that of mid-2021.
Accrol said it is "confident of meeting its revised expectations" and has "more than sufficient liquidity to meet its existing and future needs".
The company will conduct a strategic review of the business in light of these adjustments.
A further update will be provided on Tuesday next week, alongside results for the half-year that ended October 31.
By Elizabeth Winter; [email protected]
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