PTD.L Regulatory News (PTD)

1 Dec 2005 08:30

Pittards PLC01 December 2005 Pittards plc Trading update In my interim statement of 31 August 2005 I reported that the strategy changefor the Company which started towards the end of 2004, was progressing well.The contract we were awarded in August to manage Ethiopia's largest tanneryprovides us with opportunities across our range of glove, shoe and luxury goodsleathers. We reported a pre-tax loss of £1.5m for the six months ended 30 June 2005, and Icommented that the higher chemical, fuel, power and waste treatment costs wewere experiencing made it unlikely that we would show much improvement in thesecond half on our performance in the first six months. Our Leeds operation, which was loss-making in 2004 and in the first half of thisyear, has had a particularly difficult third quarter largely as a result ofdisappointing sales and continuing problems with raw material sourcing. Thishas been compounded by the substantial increases in energy and waste treatmentcosts which have overwhelmed the savings made in other overheads. As aconsequence, the Group's trading loss in the second half is likely to besubstantially greater than the loss in the first six months. This has caused usto accelerate the planned review of our manufacturing resources. Consultationshave begun which may ultimately lead to the consolidation of production at ourYeovil and Ethiopian sites, and the cessation of production in Leeds. By consolidating production in two facilities rather than three, we wouldimprove our international competitiveness not least through the elimination ofthe fixed costs associated with the Leeds operation. The costs of closure wouldbe substantial but would be expected to be more than covered by the proceeds ofsale of the valuable freehold factory premises. We continue to make progress in reducing debt. Total borrowings were £9.2m at 31October compared with £11.1m at 30 June 2005, and £11.7m at the end of 2004.Net assets at 31 October, before taking account of the deficit on the pensionscheme, were approximately £17.4m. The deficit on the pension scheme, calculated in accordance with FRS17 was£34.4m as at 30 June 2005. As discussed with shareholders at the EGM on 22September 2005, and in consultation with relevant stakeholders, we are workingwith our advisers to find a resolution to the pensions issue. SD Boyd Chairman 1 December 2005 Enquiries to: Sally Smith, Tradewinds on telephone 01935 842094 or mobile 07729 301207 This information is provided by RNS The company news service from the London Stock Exchange