28th Feb 2019 08:45
LONDON (Alliance News) - Howden Joinery Group PLC on Thursday reported a rise in annual revenue and profit but warned of 'no-deal' Brexit risks as it prepares to face the UK's exit from the European Union in late March.
Shares in the FTSE 250-listed supplier of kitchen and joinery products dropped 5.8% trading at 496.10 pence each Thursday morning, hitting a low of 479.18p.
For 2018, Howden Joinery posted pretax profit up 2.7% to GBP238.5 million from GBP232.2 million a year prior.
Revenue jumped 7.7% to GBP1.51 billion from GBP1.40 billion, with UK depots revenue accounting for GBP1.48 billion.
"Howdens delivered another good performance in 2018," Chief Executive Officer Andrew Livingston said. "We have initiatives underway to improve business performance further, focussed on depot format efficiencies, improving range management and the development of our digital platform."
He added: "We are encouraged by the start we have made to the year and remain confident in our business model for the future."
The first weeks of 2019, saw Howdens Joinery UK depots sales up 4.0%. The company now believes there is opportunity to increase the number of depots to 850 from 694.
With regards to Brexit, the company said it remains "cautious given economic uncertainties".
"In preparation for a 'No-Deal' Brexit, our worst case scenario, a number of measures have been taken. Our stocking policy for at-risk items has been adjusted to secure continuity of supply during the transition," Howdens said.
It added: "As a result, around GBP15 million additional inventory has been purchased and key suppliers are also making plans to ensure supply. In addition, we are looking closely at the options for our inbound supply routes and pursuing appropriate logistics accreditation, including Authorised Economic Operator status, to reduce potential customs delays."
The company upped its total dividend by 4.5% to 11.6 pence per share from 11.1p issued a year ago, after proposing a final 7.9p payout.
Furthermore, Howden Joinery said it will repurchase GBP50 million of shares within the next two years, returning cash to shareholders.
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