RNS Number : 9300J
Chamberlin PLC
10 April 2024
 

10 April 2024

 

Chamberlin plc

("Chamberlin", the "Company" or the "Group")

 

Trading Update

 

Chamberlin plc (AIM: CMH.L), the specialist castings and machining group, announces a trading update in respect of the three-month period ending 29 February 2024 ("Q3 FY24") and outlook for the final quarter of FY24 ending 31 May 2024 ("Q4 FY24").

 

Underlying demand across the Group during Q3 FY24 was below management's expectations. Schedules over the period were lower than previously forecast by our customers and were further impacted by delays with the startup of certain new programs. Encouragingly, demand from customers in the renewable offshore energy market remained very strong, but the majority of other market sectors were affected by a slowdown in immediate demand.

 

Lower sales during Q3 FY24 have negatively affected profitability and working capital, however the management team are taking appropriate action to mitigate the impact now and going forward.

 

The slowdown has started to improve during Q4 FY24 and customer schedules are recovering to a more normalised and stable level, with a strong uptick in demand forecast within the next 6-month period as new programs start to ramp up production.

 

Following a full strategic review, a program of cost reduction actions have been implemented across the Group including labour reductions, short time working (as required) and senior management restructuring. Alongside this, the Company has conducted a full review of product margins and implemented price increases accordingly to underpin the required profitability and cash generation. The Group is expected to benefit from these actions within 3 months and create a more robust level of profitability going forward.

 

As previously announced, balance sheet debt following the sale of Petrel Ltd has greatly improved and the Company remains focused on paying off the remainder of its legacy debt within the next 12-month period (excluding the remaining pension deficit and HSBC invoice finance facility). Working capital levels are being monitored closely following recent performance and the steps being taken by the management team are expected to improve this position going forward.

 

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018.

 

Enquiries:

 

Chamberlin plc

Kevin Price, Chief Executive

Alan Tomlinson, Finance Director

 

 


T: 01922 707100

Cavendish Capital Markets Limited

(Nominated Adviser and Joint Broker)

Katy Birkin

Stephen Keys

George Lawson

 

 


T: 020 7220 5500

Peterhouse Capital Limited

(Joint Broker)

Lucy Williams

Duncan Vasey


T: 020 7469 0930

 

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