REG - Churchill China PLC - Trading Update

Churchill ChinaAnnouncement

20/11/2024 07:00

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RNS Number : 8756M  Churchill China PLC  20 November 2024

The information communicated within this announcement is deemed to constitute
inside information as stipulated under the Market Abuse Regulations (EU) No.
596/2014 as it forms part of UK domestic law by virtue of the European
Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the
Company's obligations under Article 17 of MAR. Upon the publication of this
announcement, this inside information is now considered to be in the public
domain.

 For immediate release  20 November 2024

 

CHURCHILL CHINA plc

("Churchill" or the "Company" or the "Group")

 

Trading Update

 

Churchill China plc (AIM: CHH), the manufacturer of innovative performance
ceramic products serving hospitality markets worldwide, provides a trading
update on the current financial year, ending 31 December 2024.

As highlighted in our Interim Results, global hospitality markets remain
subdued. Revenue in the year to September has been below that expected, but,
due to a strong operational performance, profitability has not been affected
as significantly. In the final quarter to date,  the Company has not seen the
normal seasonal uplift in order intake from, particularly, the independent
sector. As a result, the Company now anticipates a reduction in its forecast
for the final quarter of 2024 and the profitability for the year is
consequently expected to be materially below market expectations.

 

It is anticipated that this softness in our key hospitality markets will
continue into 2025 driven by the effects of the UK budget and political
uncertainty in some key European markets. In addition, implications of the
recent UK budget will materially impact the cost base which can only partially
be offset by price increases. Accordingly, actions on costs are being taken to
mitigate these cost increases. As a result, the Company believes that the
outlook for next year will also be impacted, and the expected profit in the
year will be reduced from current market expectations.

 

This situation does not change the fundamentals of our business. We have
high-quality differentiated products with significant growth potential as
markets recover, particularly where we currently have low market share. All of
which is backed by solid financials of operational cash generation and a
strong unencumbered balance sheet.

 

Robin Williams, Chairman of Churchill China, commented:

 

"The current macro-economic uncertainty combined with significant increases in
our cost base creates near term challenges. We are, however, confident that
our core strategy will continue to deliver growth as markets improve."

 

 

For further information, please contact:

 

 Churchill China plc                                Tel: 01782 577566
 David O'Connor / James Roper / Michael Cunningham

 Buchanan                                           Tel: 020 7466 5000
 Mark Court / Sophie Wills / Abigail Gilchrist
 ChurchillChina@buchanan.uk.com

 Investec                                           Tel: 020 7597 5970
 David Flin / Oliver Cardigan

 

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