Chamberlin: Trading update most encouraging

Chamberlin plc (LON:CMH) recent trading update was most encouraging, considering these challenging times. The company continues to take appropriate operational strategic actions. The group has been financially de-risked, but financial forecasts continue to be inappropriate, given low visibility on business activity.

  • Trading update: Unaudited results for the year to 31 March 2020 were in line with expectations, with sales expected to be £26.1m and a loss before tax of £2.3m. Net debt at 31/03/20 is expected to be £4.6m. Trading in the current year has started well, with sales for the six months to 30/09/20 at £11.0m (down just 15%) and with a loss before tax of £0.6m (£1.8m).
  • 2020/21 forecasts, however, remain unpredictable and inappropriate, given the uncertainty across global markets and industries, especially the automotive industry. The company is benefiting from restructuring initiatives, with a reduced operating cost base. Management remains focused on cash preservation
  • Business developments: The Walsall foundry reopened on 04/05/20, and production levels are now broadly in line with activity seen prior to the impact of COVID-19. The Scunthorpe foundry has remained operational, operating at full production levels. Petrel is still operating at around 60% of normal sales volumes.
  • Risks: Potential risks include developments related to the COVID-19 pandemic, the global automotive industry and Brexit uncertainties. From a financial standpoint, the group has been significantly de-risked, with the recent Exidor disposal proceeds used to reduce the pension scheme deficit and pay down debt.
  • Investment summary: The Chamberlin shares offer the opportunity to invest in a highly cyclical stock. They are, though, likely to tread water at current levels, until significantly brighter prospects become more evident.

DOWNLOAD THE FULL REPORT

Click to view all articles for the EPIC:
Or click to view the full company profile:
    Share on facebook
    Facebook
    Share on twitter
    Twitter
    Share on linkedin
    LinkedIn
    Hardman & Co

    More articles like this

    Hardman & Co

    Chamberlin: Trading update ‒ main businesses performing solidly

    Chamberlin plc (LON:CMH) recent trading update (23 November 2020) indicates that the group’s main businesses are performing as previously indicated, with the company continuing to take appropriate operational strategic actions. The group has been financially de-risked but financial

    Hardman & Co

    Chamberlin Trading stalled in these unprecedented times

    Chamberlin plc (LON:CMH) recent trading update revealed that trading is stalling in these challenging times. The company, however, is taking appropriate strategic actions. The group has been financially de-risked, and the shares remain appropriately valued against the peer

    Hardman & Co

    Chamberlin Plc Near-term trading subdued

    The recent trading update revealed sustained challenging markets. Chamberlin, however, is still on track strategically, and the group continues to develop its product offering most favourably. The group has been financially de-risked, and the shares remain attractively valued

    Hardman & Co

    Chamberlin Management actions yield cautious optimism

    Trading remains difficult, and cost reduction measures continue to be implemented. Chamberlin is still on track strategically, and the group continues to develop its product offering most favourably. The group has been financially de-risked, and the shares remain

    Hardman & Co

    Chamberlin Plc Trading remains difficult; forecasts lowered

    Chamberlin Plc (LON:CMH), Prospects remain very uncertain, and cost reduction measures continue to be implemented. Chamberlin remains on track strategically. The group continues to develop its product offering to the automobile turbocharger industry through development of its main

    Hardman & Co

    Chamberlin Plc Trading very difficult; forecasts lowered

    Chamberlin Plc (LON:CMH), Prospects are very uncertain, and cost reduction measures are being implemented. However, the group continues to develop its product offering to the automobile turbocharger industry through development of its main operational facilities. The recent technical

    Hardman & Co

    Chamberlin Plc Trading strong, technical issues largely resolved

    Chamberlin Plc (LON:CMH) remains on track strategically, and the technical problems at the new machine shop are now largely resolved. The group has consequently delivered a significantly improved performance in the second half of 2017/18. Prospects are most

    Hardman & Co

    Chamberlin Plc Trading healthy, technical issues improving

    Chamberlin Plc (LON:CMH) remains on track strategically, as good progress is made towards resolving the technical problems at the new machine shop. The group has consequently delivered a significantly improved performance in the second half of 2017/18. Prospects