(Alliance News) - Epwin Group PLC on Thursday reported a drop in 2019 earnings and said that it will cut dividend payment by more than half due to the ongoing health crisis.
Shares in the building products manufacturer were trading 4.8% lower at 65.20 pence each on Thursday afternoon in London.
For 2019, Epwin posted pretax profit of GBP12.4 million, down 6.8% from GBP13.3 million reported for 2018. Revenue for the period was GBP282.1, up 0.4% from GBP281.1 million.
Administrative expenses rose to GBP37.9 million from GBP35.6 million and net finance costs rose o GBP2.1 million from GB1.5 million.
The Solihull, England-based company said trading conditions in its second half were challenging due to uncertainty regarding the general election as well as the timing of Brexit.
No final dividend was declared due to Covid-19-related uncertainty, resulting in the October interim dividend of 1.75 pence being the only payout for the year. For 2018, an annual dividend of 4.90 pence was paid. The company expects to save GBP4.6 million from the dividend cuts.
Looking ahead, Epwin said that while trading until the middle of March was slightly ahead of expectations, the Covid-19 outbreak has resulted in it pausing its operations. It added that it is implementing cash conservation methods in order to mitigate the extent to which the pause in operations will hurt its 2020 results.
"In anticipation of significantly-reduced demand levels and in the interest of customer and employee safety, we took the decision on March 25 to implement a controlled shutdown of Epwin's operating sites for a temporary period. We will restart the business as soon as it is safe and socially responsible to do so and when demand makes operations economically viable," said Chair Andrew Eastgate.
As at the end of March, Epwin had around GBP45 million of headroom from its GBP75 million of banking facilities, including cash on the balance sheet.
By Ife Taiwo; ifetaiwo@alliancenews.com
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Epwin Grp (EPWN)