AMBR.L Regulatory News (AMBR)

Ambrian plc

Trading Update

Ambrian plc ("Ambrian" or the "Company" or, together with its subsidiaries, the "Group") provides the following trading update in respect of the Group's cement production activities in Beira, Mozambique and on the current financial position of the Company.

Operational Update

Cement sales volumes for the second and third quarters of 2017 reflected the trends reported by the National Department for Statistics in respect of overall cement sales in the central part of Mozambique, being 16 % lower in Q3 2017 compared to Q3 2016 but 20% higher compared to Q2 2017. The general economic conditions in the country have been very challenging over the last 12 months. However, the Group has seen activity within the construction sector improving over the last six months and, in terms of sales, the fourth quarter of 2017 has been very strong and has represented the first quarter where the Group's operations have been ahead of budget for three consecutive months. For the year ending 2017, sales are forecast to be approximately 25% higher than for the same period 2016. In addition, the Group has seen cement prices improve year-on-year and the plant in Beira is now generating a positive EBITDA.

With regards to the debt position of Cimentos de Beira ("CdB"), the restructuring of the term loan facilities with the Industrial Development Corporation of South Africa, as outlined in the Interim Results announcement in September 2017, still remains subject to conditions precedent being satisfied. CdB also has local working capital facilities which charge interest based on national Lending Rates which are currently in excess of 25 per cent. and which impact upon the net income of the business.

Financial Update

Whilst the operational performance of the cement operations in Mozambique is improving, the Company is facing urgent short-term liquidity issues owing to difficulties in moving cash resources held within the Group to the Company.

As a consequence, the Board is closely monitoring the cash position of Company and anticipates that short-term, external financing will be required in order to ensure the Company can continue to meet its obligations as they fall due. In that regard, the Company is currently in discussions with potential counterparties in relation to securing both short-term financing for the Company and a longer-term strategic partnership and investment for the Group as a whole to allow it to reduce its debt and develop its principal asset in Mozambique significantly. Whilst these discussions are at an advanced stage, there can be no certainty that any such financing or strategic partnership will be concluded.

The Board has undertaken a number of steps in an effort to mitigate the extent of the Company's cash outflows in the short-term, including deferral of non-executive director fees for December 2017. As at the date of this announcement, the majority of non-executive board members have agreed to this deferral.

The Company is also in discussions with all Board members and senior management of Ambrian who hold Convertible Loan Notes issued by the Company on 16 October 2015, the principal terms of which were announced on 30 September 2015 (the "Convertible Loan Notes") about the possibility of deferring the interest payment due on those Convertible Loan Notes for the period 1 July to 31 December 2017, with such interest currently scheduled to be paid in December 2017.

As announced on 31 July 2017, the Company has engaged Verdant Capital, an African corporate finance specialist, to assess strategic options for the Company's cement operations. This review is ongoing.

Further updates will be issued in due course.

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This announcement contains inside information for the purposes of Article 7 of the Regulation (EU) No 596/2014 on market abuse