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(Sharecast News) - Logistics services group Touchstar traded in line with expectations during the first quarter but warned of tougher times ahead as it kicked off talks with its lenders regarding its capital position.
Touchstar said first-quarter trading was broadly in line, with growth from continuing businesses up 40% year-on-year.
However, given the "current and likely impacts" of Covid-19, the group said it was now planning for "prolonged uncertainty" and cautioned that it had seen a reduction in new business inquiries - a pattern it expects to continue.
"It is impossible to provide clarity on the outlook for the weeks and months ahead," said Touchstar.
In order to protect its financial position, the AIM-listed group said it would reduce cash expenditure to protect its liquidity in the short term. In its supply chain, Touchstar said it would only spend "where necessary" to deliver confirmed orders.
"The outlook during this crisis remains uncertain, we are in defensive mode, working tirelessly, with a complete focus on navigating this event, and believe we will return to growth when the economy recovers," concluded the group.
As of 1110 BST, Touchstar shares were up 6.40% at 26.60p.
26 Apr 2022 14:53
IN BRIEF: Touchstar sees annual revenue growth on strong recovery
Touchstar PLC - Manchester-based supplier of mobile data computing services - Reports revenue of GBP6.1 million for 2021, up 3.7% versus GBP5.9 million for 2020. Pretax profit more than triples to GBP207,000 from GBP23,000. Credits its performance in 2021 to a "healthy" recovery from the pandemic. Says 2022 started well with strong trading in the first quarter. Expects to see continued revenue and earnings before interest, tax, depreciation growth in 2022. Warns of geo-political instability, inflationary pressures and higher interest rates that will "inevitability" result in "hesitancy in corporate decision making."
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