8th Apr 2020 13:25
(Alliance News) - Churchill China PLC on Wednesday posted a 28% jump in annual profit, but decided against a final payout, and said that it will not provide forward guidance due to lack of visibility amid the Covid-19 pandemic.
The ceramics products manufacturer, which has paused its production in line with UK government guidelines, expects the virus outbreak to impact trading performance for the first half of 2020 and, as a result, has adjusted its forward plans to manage cash and reduce costs.
The company expects Hospitality revenue to decline in short term and take several months to recover to normal levels. As a result, it expects to optimise production towards other sectors like tableware market.
For 2019, Churchill China recorded pretax profit of GBP11.3 million, up from GBP8.8 million in the year ago period due to organic revenue growth and contribution from acquisition of Stoke-on-Trent ceramic products manufacturer Furlong Mills in February 2019.
Operating profit before exceptional items increased by 22% to GBP11.2 million, with Furlong Mills contributing GBP400,000. Margins increased to 16.7% from 16.0%.
Total revenue for 2019 increased by 17% to GBP67.5 million from GBP57.5 million, with further strong growth in Hospitality ceramics export sales and the inclusion of revenue of GBP4.8 million from Furlong Mills.
Ceramic revenue growth, excluding Furlong Mills, was 9%, with sales rising to GBP62.7 million from GBP57.5 million. Revenue from UK increased 3% to GBP23.6 million and export revenue jumped 13% to GBP39.1 million.
Churchill China ended 2019 with cash and equivalents of GBP12.6 million versus GBP14.4 million a year ago.
Shares in the company were up 8.5% at 1,430.00 pence each in London on Wednesday afternoon.
By Tapan Panchal; [email protected]
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