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Churchill ChinaAnnouncement

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RNS Number : 3899R  Churchill China PLC  17 July 2025

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

 

17 July 2025

Churchill China plc

("Churchill China" or the "Company")

Trading Update

 

Churchill China plc (AIM: CHH), the manufacturer of innovative performance
ceramic products serving hospitality markets worldwide, announces an update on
trading in the current financial year ending 31 December 2025.

As communicated at the AGM, hospitality markets remain challenging with
reduced demand for our product, particularly in export. Following a late
Easter, April performance was broadly in line, however, the financial
performance in May and particularly June was materially below target, meaning
that the Company will deliver profitability significantly below last year at
the half year. Whilst UK and USA sales have been robust, European and Rest of
the World sales are tracking behind last year. The German market, in
particular, has been difficult. We have also experienced trading down from our
more expensive non-round pressure cast product into our own lower priced round
product. We continue to be the supplier of choice into our distributor
network, but it is the restaurants, particularly the independents, where cost
pressures are creating market contraction, new installation projects remaining
at lower levels, and increased competitive intensity. Replacement business
remains at expected levels from the extensive installed base.

The Company has reduced hospitality production in line with the new demand
profiles, but this has naturally resulted in lower factory recoveries in
addition to the reduced margin due to sales mix.

Outlook

Despite the end user weakness, the Company believes that it continues to
defend market share in its key markets. Capital projects initiated in the
first half, focussed on increasing agility and improving our cost base are now
broadly complete. We have also identified capital projects to pull forward to
further reduce our cost structure. New product introductions, utilising inkjet
and pressure cast, are being accelerated to restore growth exploiting our
investment in these processes. We continue to review our cost base on an
ongoing basis whilst being mindful of retaining skills required for growth.

Even with these actions, the continued market headwinds noted above mean that
the Company will deliver revenue and profits for the full year significantly
below the prior year.

We continue to prioritise a healthy cash balance which we intend to retain. We
expect our markets to recover in the medium term and see no change to the
long-term potential of the business.

We remain a well invested business in structured markets with a high
percentage of our revenue originating from replacement orders at good margins.

The Company will issue its results for the six months ended 30 June 2025 in
early September 2025.

 

For further information, please contact:

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

 Burson Buchanan                                                         Tel: 020 7466 5000
 Mark Court / Sophie Wills / Abby Gilchrist
 churchillchina@buchanan.uk.com (mailto:churchillchina@buchanan.uk.com)

 Investec Bank plc (Nominated Adviser and Joint Broker)                  Tel: 020 7597 5970
 David Flin / Oliver Cardigan

 Panmure Liberum Limited (Joint Broker)                                  Tel: 020 3100 2000
 Edward Thomas / John More

 

 

 

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