25th Mar 2020 09:32
(Alliance News) - Waste business Biffa PLC on Wednesday warned it will be seeing a steep fall in demand from commercial customers due to Covid-19.
High Wycombe-based Biffa said the disruption from Covid-19 will not have too much of an impact on its financial year ending on Friday. However, no final dividend will be declared for the year.
However, it now expects "significant disruption" to operations over the next few months. The main impact will be on the Industrial & Commercial business which will see "very significant" reduced demand as customers are forced to stop operations.
There will also be a fall in volumes of processing in the Resources & Energy unit, while all businesses will be hindered by workers either being ill or forced to miss work.
"Given the rapidly changing dynamics in the external environment, it is extremely difficult to predict with any accuracy what the impact of Covid-19 will be on Biffa in financial 2021. It is, however, clear the impact will be material and as such the group is not providing guidance at the current time," said Biffa.
Biffa has a five-year committed GBP350 million facility, and as of Thursday, it expects to have combined cash and facility headroom of GBP150 million.
To preserve cash, all M&A has been frozen, and all non-essential expenditure has been halted.
"The board is confident the combination of available liquidity, coupled with the above mitigation actions will enable the group to shoulder this downturn in the near term and that going forward the group will then be able to progress its growth strategy over the medium term," the company concluded.
Biffa shares were 6.1% lower on Wednesday morning in London at 214.00 pence each. The stock was promoted to the FTSE 250 index on Monday.
By George Collard; [email protected]
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