(Alliance News) - Maintel Holdings PLC on Wednesday said that it had paused dividend payments as it reported a loss and reduced revenue.
Shares in the London-based communications service provider were trading down 13% at 300.00 pence each in London on Wednesday morning.
Maintel swung to a pretax loss of GBP2.2 million for 2020, compared to a profit of GBP1.8 million in 2019.
Revenue dropped 13% year-on-year to GBP106.4 million from GBP122.9 million, as a result of project delays related to the pandemic, a reduction in its managed services support base and the loss of a number of legacy contracts in 2019.
Capital expenditure increased to GBP2.7 million from GBP1.9 million, while other increased costs included GBP8.0 million of repaid debts compared with none repaid in 2019 and GBP2.5 million in "exceptional items", up from only GBP385,000 the prior year.
Maintel brought in GBP4.5 million from the sale of its Managed Print Service business, the proceeds of which were used to reduce the company's net debt.
Given the impact of the pandemic and uncertainty around its potential continuation, the company's board decided to pause dividend payments as part of a wider cost saving programme. This is compared to a payout of 15.1 pence per share in 2019.
Maintel said that its performance in the past year was in line with its own expectations given the national lockdowns in the fourth quarter of 2020 and first quarter of 2021. The company said sales and cash generation remained strong into the second half of the year.
For the coming year, Maintel indicates that it will continue to apply their "transformation strategy". This involves prioritising the company's cloud and managed service businesses, launching several new products and establishing new partnerships, whilst also keeping costs down.
"Although we remain mindful of the potential effect of the pandemic on project deliveries through the year, for example in the event of further lock-downs, we are confident of a return to organic growth on a like-for-like basis" the company said.
On Wednesday, Maintel announced that Chief Financial Officer Mark Townsend plans to leave his post around the end the 2021 after five years in the role.
Annette Nabavi has also decided not to seek re-election as non-executive director and will step down at the company's upcoming 2021 annual general meeting. The company has begun its search for replacements for the roles and expects to fill both in due course.
By Scarlett Butler; scarlettbutler@alliancenews.com
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Maintel (MAI)