(Alliance News) - Ultra Electronics Holdings PLC on Tuesday said trading in the first quarter of 2020 was "broadly in line with expectations", but it withdrew 2019 final dividend recommendation amid the Covid-19 virus outbreak.
The defence engineering company said revenue, profit, cash performance and order book for the three months to the end of March also were in line with expectations.
Ultra Electronics added that its product and programme delivery have not been hurt by Covd-19, as demand remains "robust", supply chains stable, and any disruption caused by changing work patterns kept to a minimum. It added that it has put together a plan to respond to challenges that may arise as a result of the pandemic.
As at the end of December, the FTSE 250-listed company had cash of GBP82.2 million and GBP214.5 million undrawn on its revolving credit facility. Net debt was GBP113.6 million.
Ultra has withdrawn its recommendation to pay a 2019 final dividend of 39.2 pence due to the uncertainty caused by the Covid-19 pandemic. However, it said it intends to pay an additional interim dividend of 39.2p in the second half of 2020, dependent on a future review.
"The group remains in a strong financial position, is operating in robust markets and continues to trade well despite the current crisis. It is too early to judge what the full impact on 2020 will be, but order book and demand remain strong. We do anticipate a small impact on revenue from weakness in commercial aerospace and wider customer driven delays, and on margin due to production inefficiencies, but these are expected to be limited. We currently still expect 2020 to be a year of good progress for Ultra."
The stock was trading 2.8% higher at 2,001.22p each on Tuesday morning in London.
By Ife Taiwo; ifetaiwo@alliancenews.com
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