REG - Chamberlin PLC - Trading Update

ChamberlinAnnouncement

10/04/2024 07:00

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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                           T: 01922 707100

 Kevin Price, Chief Executive

 Alan Tomlinson, Finance Director

 Cavendish Capital Markets Limited        T: 020 7220 5500

 (Nominated Adviser and Joint Broker)

 Katy Birkin

 Stephen Keys

 George Lawson

 Peterhouse Capital Limited               T: 020 7469 0930

 (Joint Broker)

 Lucy Williams

 Duncan Vasey

 

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