27th Jan 2009 14:14
27 January 2009
Trading Statement
In our Interim Results announcement at the end of November, we noted that second half sales, on a constant currency basis, were 10% down on the comparative period last year. Since then, the well publicised severe deterioration in some of our markets - automotive, building and construction and industrial assembly - together with generally poor trading conditions throughout the world economies, has led to a further marked reduction in revenue.
December sales were 34% lower than the prior year on a comparable basis. Current estimates for January are that comparable sales will be down by approximately 15% on prior year and that the remainder of the financial year to March 2009 will continue to be challenging.
In response to the rapid downturn in activity the Group has taken a series of actions to permanently reduce its cost base. These actions will result in a reduction of the Group's worldwide workforce by approximately 140 employees (11%) by the end of March, of which 110 have already left. Exceptional charges in respect of this programme are expected to amount to around £1.5m in this year's accounts.
In addition, last Friday we commenced formal discussions with our employee representatives on the future of our Bellegarde facility in France that could result in the closure of the site which currently employs 68 people.
Commenting on the action plan, Chief Executive, Calvin O'Connor, said that "Scapa regrets the reduction in the number of employees and we are working with employee representatives to limit the impact of these changes. We have taken action to maintain the overall commercial and financial strength of the Group at this time of unprecedented uncertainty and current severe downturn in market demand."
For further information:
Calvin O'Connor Chief Executive Tel: 0161 301 7430
Brian Tenner Finance Director Tel: 0161 301 7430
Chris Hardie Arden Partners Tel: 0207 398 1639
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