Eurocell plc AGM and COVID-19 Update (8340M)
May 14 2020 - 2:00AM
UK Regulatory
TIDMECEL
RNS Number : 8340M
Eurocell plc
14 May 2020
14 May 2020
EUROCELL PLC
(Symbol: ECEL)
AGM and COVID-19 Update
Eurocell, the market leading, vertically integrated UK
manufacturer, recycler and distributor of innovative window, door
and roofline PVC products, provides the following COVID-19 update
ahead of its Annual General Meeting to be held at 3pm today.
Initial Actions in Response to COVID-19
As previously announced, performance in the 11 weeks to 20 March
2020 was in line with our expectations and there was no discernible
impact on trading from COVID-19. Since then, our manufacturing
plants, branch network, distribution and recycling operations have
all been closed, in line with the official guidance from the UK
Government.
Alongside the closure of our operations, we also took a number
of significant, swift actions to conserve cash. These included the
deferral of non-essential operating costs and the vast majority of
planned capital expenditure whilst operations remained closed, and
cancellation of the final dividend payment for the year ended 31
December 2019. Also as part of these actions, the Board and other
members of the senior management team agreed to a 20% reduction in
remuneration. In addition, we have continued to make use of various
Government measures available, including the Coronavirus Job
Retention Scheme.
Bank Facility and Share Placing
We have a strong balance sheet and were able to increase our
bank facility to GBP75 million in March 2020. As previously
disclosed, we continue to believe our banks will be supportive of
reviewing covenants, if required.
Given the ongoing uncertainty of the COVID-19 situation, on 1
April we raised approximately GBP17.6m by way of a share placing.
Net proceeds will be used to ensure we retain headroom on our bank
facility, even under an extended shut-down, and to provide
sufficient liquidity for investment in our new state-of-the-art
warehouse. As well as being key to increasing total capacity, the
new warehouse will deliver improved operational efficiencies. Good
headroom on our bank facility will ensure the business is well
placed to capitalise on opportunities when markets re-open.
Re-opening Plans
We are now pleased to announce that, following the latest
guidance from the Government, which permits tradesmen to work in
domestic dwellings so long as appropriate precautions are taken, we
have implemented the first steps towards re-opening the business.
On 11 May we recommenced supply to our fabricator customers from
existing stocks and opened six branches around the country. This is
allowing us to test our safe-working practices and begin to assess
the level of customer demand.
We are encouraged that trading over the first three days has
been robust, although it is not yet clear whether this is a result
of pent up or underlying demand. Subject to the on-going results
from these activities, and in particular there being sufficient
underlying demand, we plan a phased re-opening of the business over
the coming weeks. This includes a return to manufacturing when
required to ensure continuity of supply to customers.
In the meantime, fit-out of the new warehouse remains on track
and we continue to target being operational early in 2021, although
this date may still be affected by COVID-19 developments.
We will provide a further update when there is more clarity on
the impact of COVID-19 on the Group.
Annual General Meeting
The 2020 Annual General Meeting will be held at 3pm today at
Fairbrook House, Clover Nook Road, Alfreton, Derbyshire, DE55 4RF.
As previously announced, and in line with Government guidance in
relation to COVID-19, shareholders, proxies and other attendees
will not be permitted to attend the AGM in person and shareholders
have been strongly advised to vote by proxy. A facility to ask the
directors questions by email was made available. Answers will be
published, in due course, on the Company's website:
www.eurocell.co.uk .
Enquiries:
Eurocell plc
Mark Kelly, Chief Executive Officer
+44 (0) 1773 842 105
Michael Scott, Chief Financial Officer
+44 (0) 1773 842 140
Teneo
Ben Foster
+44 (0) 777 624 0806
Camilla Cunningham
+44 (0) 7464 982 426
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END
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