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4 Jun 2009 07:00
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For immediate release 4 June 2009
Porvair plc ("Porvair" orΒ theΒ "Group")
Β
Confirmation of banking arrangements and trading update
Porvair, the specialist filtration and environmental technologies group, today,Β announcesΒ theΒ completion of its banking renegotiations andΒ issues a trading update for the six months ended 31 May 2009.
Trading Update
In the six months ended 31 May 2009, the Group has traded in line with the expectations set out in the Interim Management Statement on 7 April 2009. The Group'sΒ UKΒ and European operations have continued to trade wellΒ and theΒ USΒ operations have been more stable in the second quarterΒ compared with the earlier part of theΒ year.Β Β The Group has beenΒ cash generative,Β in line with expectations.Β Β Progress with new products has beenΒ encouraging.
The Microfiltration division, based in the UK and Europe, is trading well with the order book supported by account wins, new project work and currency benefits. Energy filtration demandΒ remainsΒ strong, notably in gasification and nuclear remediation and weΒ are pleased to have won several substantial new contracts in the nuclearΒ market. Some aviationΒ and general industrialΒ orderΒ schedules haveΒ reducedΒ butΒ overallΒ new projects have made up forΒ any shortfall. Current trading at Seal Analytical is encouraging withΒ theΒ integrationΒ processΒ nowΒ complete.
Trading in theΒ USΒ continues to be challengingΒ but hasΒ been more stable in recent weeks.Β Β SalesΒ ratesΒ in the Metals Filtration divisionΒ are aroundΒ 35% lower than the prior year.Β Β In response,Β employee numbers have been cut by 40% and salaries of remaining staff temporarily reduced. As previously announced, these actions will give rise to a one-off charge of circa Β£600,000 in the periodΒ and will reduce annualisedΒ ongoingΒ costs in the Metals Filtration division by approximately Β£1.5m.Β Β Despite this upheaval, progress with new products that will underpin ourΒ USΒ business recovery has beenΒ promising.Β Β Conversions to our new aluminium filter continue andΒ theΒ first shipments of our battery component have been made.
Including one-off costs, mostly US redundancies, the GroupΒ willΒ incur aΒ smallΒ operating loss in the first half of the year.Β Expectations of a strongerΒ GroupΒ performance in the second half are underpinned by orders in theΒ UKΒ due for delivery later in the year and the much lowerΒ USΒ cost base.
Banking Arrangements
Porvair hasΒ completed the renegotiation of its banking facilitiesΒ with Barclays. The Board isΒ satisfied that the revised banking arrangements will provide the flexibility to support the Group's futureΒ development.Β Β In summary, the revised arrangements include:
Reconfirmation of all of the existing facilities
AmendmentΒ of the Group's covenant arrangementsΒ
RevisedΒ margins on the facilities of between 2.75% and 3.25% above libor.
PorvairΒ will be announcing its interim results forΒ the six months ended 31 May 2009Β onΒ Monday 22 June 2009.
An analyst briefing will be held at 10.30 am at Buchanan Communications, 45Β
Moorfields,Β London,Β EC2Y 9AEΒ onΒ Monday 22 June 2009.
For more information, contact:
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Porvair plc |
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Ben Stocks, Chief Executive |
01553 765 500 |
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Chris Tyler, Group Finance Director |
01553 765 500 |
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Buchanan Communications |
0207 466 5000 |
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Charles RylandΒ /Β Catherine BreenΒ |
Notes to editors
Porvair is a group of specialist filtration and environmental technology businesses. Its products are used in a range of niche filtration markets, and are derived from its expertise in the development and manufacture of porous and microporous ceramics, metals, plastics and carbons.
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