23rd Mar 2020 14:52
(Alliance News) -Â TheWorks.co.uk PLC on Monday said recent trading has been good but it will be closing stores and does not expect to pay a final dividend.
Trading from mid-January to March 15 had been strong, the toy, book and arts & crafts retailer said, with like-for-like sales growth of 2.9%.
"Last week, despite declining high street footfall, the group experienced a significant uplift in sales, both in stores and online, as customers demanded products to support with their child's ongoing education, mindfulness material to support mental health or products to "beat the boredom" during this period of social distancing," the company added.
It has now, though, decided to close stores as of Monday night to encourage social distancing. TheWorks's website will continue to trade as normal unless further government restrictions are put in place.
The company is taking some measures of help manage its cost basis, such as suspending all non-essential capital investment, including its new store rollout programme. It is holding talks with landlords and is reviewing planned stock intake.
TheWorks does not currently expect to declare a final dividend for the financial year ending April 26 "considering the likely prolonged impact on consumer demand".
Net cash at the end of February stood at GBP1.5 million and the group has access to a GBP25 million revolving credit facility.
"Given the continued uncertainty as a result of Covid-19, the board does not believe it appropriate to provide guidance for the financial years ending April 2020 or April 2021 at this time," said TheWorks.
Shares in TheWorks were down 7.0% at 18.65 pence in London on Monday.
By Lucy Heming;Â [email protected]
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