27th Mar 2020 11:14
(Alliance News) - Scapa Group PLC on Friday said it is in talks regarding potential financing as government restrictions in relation to Covid-19 potentially hurt operations.
The adhesive-based product manufacturer reiterated guidance for its financial year ending Tuesday next week and expects underlying trading profit to be in line with expectations.
Looking ahead, Scapa expects economic activity and consequently trading to be hurt by governmental measures put in place to contain the spread of Covid-19.
Scapa said its Healthcare sites have been assigned "essential business" status in the US and UK, while its Industrial sites are similarly deemed essential manufacturing by these respective governments.
As of Thursday, all Scapa sites were operating, it said, with the exception of India, which has been temporarily closed.
In addition, the company said it is taking steps to optimise cash flow, which includes cost savings, working capital reduction, and management of capital expenditure. Scapa intends to suspend the annual dividend.
Scapa is exploring all necessary contingency plans and has therefore commenced discussions with lenders to utilise a GBP20 million uncommitted accordion facility, it said.
The company is also in discussions with the pension trustee regarding the bi-annual contributions to create additional flexibility should it be needed.
The stock was trading 3.3% higher in London on Friday at 107.40 pence a share.
By Evelina Grecenko; [email protected]
Copyright 2020 Alliance News Limited. All Rights Reserved.
Related Shares:
SCPA.L