Last checked at 26 Mar 2020 07:00
Senior plc - Market Update
Senior plc ("Senior" or the "Group"), an international manufacturer of high technology components and systems, principally for the worldwide aerospace, defence, land vehicle and power & energy markets, today issues this market update.
Since the release of our 2019 results we have been closely monitoring the development of the coronavirus (COVID-19) situation.
The Health and Safety of our employees is always our highest priority in Senior. We are providing best practice guidelines to all of our businesses and are following national and local government instructions and guidance in the multiple jurisdictions in which we operate. We have paid special attention to those in our community who are most vulnerable and we are doing all that we can to support our employees during this unprecedented crisis.
Alongside assuring our main priority of the health and safety of employees, we have implemented detailed and flexible business continuity plans for each of our operating businesses. Daily oversight of these plans and actions is being undertaken by senior executives, chaired by the Group Chief Executive Officer.
It is clear that the coronavirus (COVID-19) is causing macroeconomic disruptions to our end markets and their respective supply chains.
Until the extent and duration of the disruption is better understood, the Board believes that taking actions to conserve cash is the most prudent way to manage through the crisis, including curtailing capital expenditure, tight management of our working capital and further cost cutting actions. In the circumstances, given the increasing level of uncertainty, the Board is no longer recommending the payment of the 2019 final dividend of 5.23 pence per share at the forthcoming Annual General Meeting ("AGM") scheduled for 24 April 2020. Resolution 3 will therefore be withdrawn from the AGM.
At 31 December 2019 our committed borrowing facilities were £305m with an average maturity of 4.4 years and the Group had headroom of £159m under these committed facilities. Leases capitalised on the balance sheet from the adoption of IFRS 16 (31 December 2019: £84m) do not form part of the definition of debt under these facilities and do not impact the Group's lending covenants.
We have two covenants for these facilities. Net debt to EBITDA must not exceed 3.0x. At 31 December 2019 the ratio was 1.1x. Interest cover must be higher than 3.5x. At 31 December 2019 this was 16.9x.
We continue with our restructuring plan, which is delivering the expected benefits. This is an on-going process and we are actively monitoring events and will take further action as appropriate.
Trading in the first two months of the year has been in line with our expectations. However, while we anticipate the structural long-term drivers of our end markets remain in place, trading for the rest of 2020 will be impacted. As a result, we are suspending guidance for 2020.
Annual General Meeting update - change of venue and time
The Company's Annual General Meeting is due to be held on Friday 24 April 2020. In the current circumstances, the Board has taken the decision to move the location of the AGM to the Company's Head Office at 59/61 High Street, Rickmansworth, WD3 1RH and to change the time of the meeting to 9.00am.
To adhere to the Government's instructions around social distancing, non-essential travel and the limit on public gatherings, shareholders are strongly discouraged from attending in person. Full details of the revised proceedings will be announced in the near future.
We encourage shareholders to submit their proxies as early as possible. Further information on how shareholders can submit their proxies can be found in the Notice of 2020 Annual General Meeting. The deadline for submitting proxies will be 9:00am on Wednesday 22 April 2020.
Notes
This announcement contains inside information.
Further information
Jennifer Ramsey | Director of Investor Relations, Senior plc | +44 (0) 1923 714 722 |
Philip Walters | Finsbury | +44 (0) 20 7251 3801 |
About Senior
Senior is an international manufacturing group with operations in 13 countries. It is listed on the main market of the London Stock Exchange (symbol SNR). Senior designs, manufactures and markets high technology components and systems for the principal original equipment producers in the worldwide aerospace, defence, land vehicle and power & energy markets. Further information on Senior plc may be found at: www.seniorplc.com
Cautionary Statement
This announcement contains certain forward-looking statements. Such statements are made by the Directors in good faith, based on the information available to them at the time of the announcement, and they should be treated with caution due to the inherent uncertainties underlying any such forward-looking information.