Chamberlin sees shares slide as losses widen
By Abigail Townsend
Date: Tuesday 04 Jun 2019
(Sharecast News) - Shares in Chamberlin fell heavily on Tuesday, after the specialist engineering and castings firm saw its full-year losses widen.
Revenues for the year to 31 March rose 9.3% to £33m, but underlying pre-tax operating losses came in at £0.9m against 2018's loss of £0.3m - although Chamberlin said that the adoption of new accountancy rules meant that the two figures were not directly comparable. Pre-tax losses were £4.96m, which was down from a loss of £1.11m in 2018.
The AIM-listed firm sold Exidor, its engineering subsidiary, for a net profit of £6.2m in December, but that was offset by an impairment charge of £3m on the fixed assets of its foundry business, "as the value of the asset could not be supported by the current level of the business".
In February, Chamberlin - which has two foundries in the Midlands - said that current trading conditions had "toughened", and warned it would post an operating loss from continuing operations of £0.6m in the full year. At the end of May, it widened that forecast to reflect "a specific bad debt".
In a statement at the full-year results, chairman Keith Butler-Wheelhouse said: "Although each of our businesses grew during the year, the performance of our principal foundry operations deteriorated in the second half, with our automotive turbocharger customers reducing their schedules.
"This partly reflected upheavals in their activities as the car manufacturers adjusted their offerings in response to the new emissions testing regime and took account of wider trading conditions."
Brexit also played a role, the company said, with engineering revenues hurt by a "weaker fourth quarter because of Brexit uncertainties".
Looking forward, chief executive Kevin Nolan warned that "near-term lower volumes from the automotive market will result in lower revenues", adding: "The major focus in the next financial year will be on reducing costs to match the lower level of output and on improving margins, in addition to developing opportunities for revenue growth."
Butler-Wheelhouse added that Chamberlin was being positioned "to deliver an improved operating financial performance" in 2019/20.
Shares in Chamberlin were off 20% by 1330 BST.
Email this article to a friend
or share it with one of these popular networks:
You are here: news
10 Lower Thames St,
London EC3R 6EN