23rd Apr 2020 13:21
(Alliance News) - Keller Group PLC on Thursday said its first-quarter performance was "materially better" than in the year prior as it announced cash conservation measures in response Covid-19 uncertainty.
The geotechnical contractor said that while activity fell in the second half of March due to government-imposed restrictions, it expects its performance for the first quarter of 2020 to be better than the comparative period in 2019.
Keller said that trading in April has remained mixed, with performance in Asia Pacific and the Europe, Middle East & Africa regions currently hurt more than North America. However, it assured that once restrictions are lifted, it expects to resume work on a majority of contracts which have been affected so far. It added that its near-term order book has been "largely unaffected".
The company has implemented cash conservation measures which include cutting capital expenditure, cancelling discretionary projects, reducing operating costs, and slashing board fees and salaries by 20% during the second quarter. It also is taking advantage of government support schemes such as staff furlough payments and tax deferrals.
The company also said that it is keeping the payment of its 27.4 pence 2019 final dividend under review until the annual general meeting, which has now been postponed to June 30.
As at the end of March, Keller had cash of GBP87 million, and undrawn borrowing facilities totalling GBP238 million. Net debt was GBP251 million.
Separately, the company said it has exited the Brazilian market through the sale of its Brazilian business Tecnogeo for BRL15 million - around GBP2.3 million - with unconditional payments totalling BRL10 million in 2020 and a final payment of BRL5 million deferred until 2021. It said the sale will result in a small non-underlying loss on disposal.
Keller shares were trading 5.4% higher at 590.00 pence each on Thursday afternoon in London.
By Ife Taiwo; [email protected]
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