2nd Jul 2019 10:14
(Alliance News) - Associated British Engineering PLC on Tuesday said it is considering the sale of its British Polar Engines Ltd operating subsidiary given a sizeable pension scheme deficit and interim loss.
Shares in the engineering firm plunged 24% to 19.00 pence in morning trade.
When reporting its financial year to March, the company noted its agreement with the trustees of the Associate British Engineering Group pension scheme - who had agreed to suspend monthly deficit contributions until the end of July.
As at March 31, the deficit stood a GBP1.4 million and was the sole liability of British Polar Engines.
In its interim statement to September 30, the company reported a drop in British Polar Engines revenue to GBP498,000 from GBP666,000 resulting in a pretax loss of GBP342,000 versus a loss of GBP377,000 the year prior.
Given the loss and the pension deficit, the pension scheme trustees have begun discussions with the pension regulator concerning the deficit. Associated British Engineering said it "has decided that it is appropriate to consider all options", which includes the possible sale of British Polar Engines.
As such, FRP Advisory LLP has been appointed "to solicit offers" for British Polar Engines, though no firm proposals have yet been made.
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