17th Aug 2020 19:00
Alliance News - Carclo PLC on Monday said it has agreed revised funding arrangements with its creditors HSBC and its pension scheme.
The technical plastic products company also noted its quarterly trading fell year-on-year, but came in higher than its expectations.
Shares in Carclo closed at 10.39 pence each, surging 34% on Monday in London.
Carclo said it has entered into new facilities with its lending bank HSBC, which comprise a term loan of GBP34.5 million and a GBP3.5 million revolving credit facility. It has also agreed deficit repair contributions with its pension scheme for 2021 until 2023, with GBP2.8 million for 2021, GBP3.9 million for 2022 and GBP3.8 million for 2023.
Turning to its trading, Carclo said that while revenue for its first quarter of financial 2021 was 12% lower year-on-year, measures implemented in preparation for Covid - such as matching cost to reduced demand and accessing Covid-19 relief schemes - meant overall trading performance was ahead of its initial Covid-19 adjusted expectations.
Its Technical Plastics business benefited from robust demand for products relating to Covid-19 testing, which partially offset a reduction in demand for other products in both the medical diagnostics and industrial sectors that had been exacerbated by the negative impact of government-imposed lockdown of a customer's facility in India. The Aerospace division performed better than anticipated largely due to continued offtake from the existing orderbook, which partly offset the impact of a significant reduction in both newbuild and spares demand from Airbus.
Looking ahead, the company said: "Activity levels in July were broadly in line with those seen in the first quarter and the Board remains cautious about market conditions in the near term.n light of the ongoing uncertainty presented by the pandemic, as well as any wider resultant economic impacts, the board does not believe that it is possible to provide detailed guidance for the year ending March 31, 2021 at this time."
"The group will continue to take action to reduce its cost base, where appropriate, to mitigate the effect of any reduction in demand, whilst seeking to preserve the capability and capacity to respond positively as conditions improve," it added
By Ife Taiwo; [email protected]
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