Group reports solid trading performance with return to normal level of operating activity from May
IN a trading update issued today (9 June), SigmaRoc plc, the AIM-quoted buy-and-build heavy construction materials group with active operations in the UK, Channel Islands and Benelux, have reported a resilient trading performance across the first five months of 2020.
For the five-month period ended 31 May 2020, the Group reported unaudited revenues of £42 million, representing 84% of revenues recorded for the same period in 2019 on a like-for-like basis.
Comparing pro-forma monthly performance with the prior year, Group revenues tracked at 60% in April and recovered to 98% in May. As a result, each platform within the Group, and the Group itself, has been EBITDA positive for each month of this year to date.
As a result of this solid trading performance and implementation of effective cash management strategies, SigmaRoc’s cash position increased from £11 million to £13.5 million during the two months to 31 May 2020, whilst the company’s long-term debt position remained largely unchanged.
The Group also has the ability to draw further bank funding within its existing facilities but says it does not presently foresee the need to do so.
Across the months of April and May, restrictions in the Channel Islands were lifted allowing the Ronez operations to resume more normal trading, albeit against a backdrop of somewhat reduced activity in road contracting in Guernsey and certain major projects in Jersey.
In the UK, the Group’s PPG and South Wales platforms scaled up towards full production at the end of April and into May as repair, maintenance and improvement work (RMI) and housing demand recovered.
The supply of large-scale precast concrete products for infrastructure projects also helped the PPG platform deliver good results, whilst South Wales relied more heavily on the gradual reopening of local road and civil engineering schemes throughout May.
Operations in Belgium remained active throughout April, albeit at a lower level than normal, but production returned to full capacity in May as order books recovered to standard run rates. By the end of May, shipments of dimension stone had returned to pre-COVID-19 levels and aggregate supplies resumed with the reopening of the Group’s partner operations in May.
Although many uncertainties remain, given the resilience of the business through April, together with the recovery in activity levels during May, SigmaRoc’s board remains confident that the Group will be able to manage its way effectively through the crisis and maintain progress in its growth strategy.
Chairman David Barrett commented: ‘I am very pleased to be reporting relatively strong results in a time of great uncertainty. The whole economy has felt the heavy impact the COVID-19 crisis has brought with it and so have we.
‘However, our business model and management team have allowed us to respond quickly and effectively. I believe this further demonstrates the strength of our strategy and its implementation.’
Chief executive officer Max Vermorken added: ‘I’m proud of the flexibility of SigmaRoc in the face of fast-changing conditions. Being a decentralized, local and entrepreneurial group allows us to be quick in our response in each area of our business.’
