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Xpediator PLC (XPD)

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Tuesday 31 March, 2020

Xpediator PLC

COVID-19 Update

RNS Number : 1235I
Xpediator PLC
31 March 2020
 

31 March 2020

 

XPEDIATOR PLC

("Xpediator" or the "Group")

 

COVID-19 Update

 

 

Xpediator (AIM: XPD), a leading provider of freight management services across the UK and Central and Eastern Europe provides the following update on how the Company is responding to the COVID-19 pandemic.

 

Overview

 

The wellbeing and safety of our people, customers and suppliers is Xpediator's first priority. From the beginning of the pandemic, we have followed the operational guidelines provided by the respective governments in each market we operate, changing working practices to incorporate social distancing across our offices, depots and warehouses. Where possible individuals are working remotely from their homes. With the significant effort of all our people, we are continuing to operate effectively whilst also taking the appropriate actions to limit the spread of this virus.

 

So far this year activity levels have remained broadly in line with management expectations, with high demand from some sectors and other areas slowing. In response we have sought to allocate resource to match demand across the business.  While it is hard to make any predictions under these extraordinary circumstances, based on very recent trends, the Board believes that demand for our freight management and warehouse services, both in the UK and Europe will remain sufficiently robust overall but will be more volatile in any given month, and that we have the systems and protocols in place to meet this demand.

 

Trading Update

 

As previously guided, we intend to announce our audited final results for the year ended 31 December 2019 in April 2020 and expect to report turnover increasing 19% to £212 million (2018: £179.2 million) and profit before tax slightly above £5.0 million.

 

Trading in the first three months of 2020 has been in line with our expectations. Although trading patterns have been different, for example revenues from Chinese customers understandably reduced in the first two months, however, this has been off-set by higher than expected demand from other sectors such as our European road freight forwarding and Pall-Ex in Romania, and over the last couple of weeks Chinese volumes have started to improve. Warehouse utilisation has been good and is expected to continue across all areas of operations. The freight forwarding division is of course asset light and has the ability to flex supply requirements against demand in a timely fashion. We have experienced supply issues on equipment and therefore buying and selling prices have increased to reflect this.

 

However, given current material uncertainties, it is not practical to give longer term guidance at this time until there is greater clarity around the duration and full effects of COVID-19 on our customers, suppliers and our markets. We are benefitting from our diverse operations across the UK and Europe which has already helped us offset challenges in some areas with higher activity in other markets. However, there are challenges to navigate such as obtaining international drivers, general increases in costs and more complex border checks.

 

Financial Strength

 

We are an asset light business and do not own a large fleet of trucks, we have low fixed overheads and typically act as a broker to our clients sourcing capacity from the market as it is required. As at 31 December 2019, the Company had net cash of £6.9 million (unaudited) and has sufficient headroom within the business to manage anticipated working capital requirements.

 

In addition, we are conducting a comprehensive review of our business and have reduced costs in specific areas where activity levels have fallen or are likely to reduce as a result of the disruption caused by COVID-19. Cost savings are expected to come from furloughing staff, agreeing temporary pay reductions and reducing other overheads.

 

The Board are confident Xpediator is well placed to manage its financial and commercial commitments during this extraordinary time and can emerge well-positioned for growth when market conditions return to normality.  The Board continue to intend to propose a final dividend for the year ended 31 December 2019, but the amount is yet to be determined given the fundamental uncertainties that currently exist in the market.   

 

The Board is closely monitoring the situation across the business and will make further announcements as and when appropriate.

 

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

 

Xpediator plc

Tel: +44 (0)330 043 2395

Stephen Blyth, Chief Executive Officer

Email: [email protected]



Cenkos Securities plc (Nominated Adviser & Joint Broker)

Tel: +44 (0)20 7397 8900

Max Hartley, Max Gould (Corporate Finance)


Nick Searle (Sales)

 


Cantor Fitzgerald Europe  (Joint Broker)

Tel: +44 (0)20 7894 7000

David Foreman, Michael Boot (Corporate Finance)


Caspar Shand Kydd, Arthur Gordon (Sales)




Novella Communications  (Financial Public Relations)

Tel: +44 (0)20 3151 7008

Tim Robertson


Fergus Young


 

About Xpediator:

Xpediator is a well-established international provider of freight management services. Established in 1988 by Stephen Blyth, the Group's international network of offices provides road, sea and air freight services, together with logistics and warehousing in the UK and Romania. The business offers integrated freight management within the supply chain logistics and fulfilment sector, through its three main areas: freight forwarding, logistics & warehousing and transport services. With headquarters in Braintree, Essex and country offices in nine CEE countries across 38 sites, the Group currently employs over 1,000 people and was successfully listed on London's AIM market in August 2017.

Import Services is the leading port centric logistics company in the UK, operating from Southampton, linking intelligent networks of supply chain services, with global real time information, to meet the new world of retailing. For more information visit https://importservices.co.uk  

 

For more information, please visit:  www.xpediator.com .

Alternatively, do follow us on Twitter at  @Xpediator  or find us on LinkedIn at  Xpediator Plc .

 


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