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Rotala PLC (ROL)

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Thursday 09 April, 2020

Rotala PLC

Trading Statement

RNS Number : 2747J
Rotala PLC
09 April 2020
 

 

RNS

 

9 April 2020

 

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain .

 

Rotala Plc

("Rotala" or the "Company" or the "Group")

 

Trading update

 

 

Rotala plc (AIM:ROL), a provider of transport solutions across the UK, announces the following update on the impact of the Coronavirus epidemic ("COVID-19") on the business of the Company, the plans which have been put in place to ensure that the Company is sustained for the duration of the current crisis and a summary of how these events are likely to affect trading results for the year ending 30 November 2020 ("FY 20").

 

COVID-19

The UK Government has designated bus operation to be an essential service in the current crisis. Passenger numbers  had fallen steeply even before the very severe restrictions on travel for all but key workers introduced on 23 March 2020. In this light, the UK Government has taken steps, through specific direction provided by the Cabinet Office to all arms of the State at both national and local level and through the Department for Transport, to ensure that bus companies have sufficient cash flow to support the operations that they are running. These measures encompass a specific Bus Service Support Grant and the maintenance of Bus Services Operator's Grant, concessionary fares re-imbursements and payments for contracted bus services broadly at their pre-crisis levels.

The support being given in this manner to ensure that essential transport services continue to run is clearly most welcome to the Group.    

Internally, the Board has taken a number of steps to align the bus services being operated with local requirements, reduce commensurately the costs of operation and conserve cash:

· Most services have been re-scheduled to an enhanced Sunday-level timetable;

· Driver rosters have been reduced accordingly;

· Discretionary capital expenditure has been suspended;

· The majority of Hire Purchase finance providers have declared a three month moratorium on instalment payments;

· Vehicle operating leases have been terminated where possible;

· The Company will participate in the Coronavirus Job Retention Scheme for staff who are not rostered to work at any one time;

· The bankers to the Company, HSBC Bank plc, have increased the overdraft facility of the Company from £3.5 million to £6.6 million.

 The Directors believe that, as a result of all these measures, the Company will be able to sustain its operations for the foreseeable future, on the reduced scale outlined above, and will be well placed to take advantage, when restrictions are lifted, of the increased opportunities in the bus market that were evident before the onset of the Coronavirus epidemic.

 

The Directors are very mindful of the demands being made on the workforce of the Company in these circumstances. Drivers in particular often work in conditions in which it is not possible to observe the "social distancing" measures which the Government has advised. The Directors are therefore grateful for the stoicism and flexibility being shown by all employees in these times, and for the active cooperation of all trade union representatives. 

 

 

Final Dividend for 2019

 

In the normal course of events the Board would have proposed a final dividend of 1.95 pence per share at the forthcoming Annual General Meeting ("AGM"). However it is clearly incumbent upon the directors to conserve cash in the current circumstances. Therefore no final dividend will be proposed to the AGM. The Board will consider at an appropriate time in the future whether it may be possible to pay a special interim dividend to replace the abandoned final dividend for 2019.

 

FY 20 outlook

 

As was highlighted in the Trading Update delivered on 27 January 2020, trading for the current year began in line with budget. However the Coronavirus crisis has made redundant all the previous guidance given to the market and any such statements must now be disregarded.   Given the current situation, and in the context of the support measures being introduced by the UK Government outlined above, it is not possible to state with any confidence what the profit and loss account outturn for the year is likely to be and the Company wishes to withdraw market guidance at this time.

 

Publication of results for the year ended 30 November 2019

 

As stated in the announcement dated 27 January 2020 it was the original intention of the Company to publish its results for the year ended 30 November 2019 in early April 2020. However in response to the Coronavirus crisis the Financial Reporting Council urged a moratorium on the release of all preliminary announcements and the Company has naturally followed this guidance. The results will now be published later this month and are expected to be in line with the market expectations prior to the onset of the current crisis. 

 

 

Rotala Plc

0121 322 2222

John Gunn, Chairman
Simon Dunn, Chief Executive
Kim Taylor, Group Finance Director


Nominated Adviser & Broker:

Cenkos Securities plc

 

020 7397 8900

Stephen Keys/Callum Davidson (Corporate Finance)
Michael Johnson/Julian Morse (Corporate Broking)


 


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