NMCN Nmcn Plc

TIDMNMCN

RNS Number : 1311C

NMCN PLC

15 October 2020

15 October 2020

Dissemination of a Regulatory Announcement that contains inside information according to REGULATION (EU) No 596/2014 (MAR).

NMCN PLC

("nmcn" or "the Company" or "the Group")

Trading Update

Following our announcement of 24 September 2020 of Board changes and the trading update, the Company has undertaken an extensive exercise to review all our major contracts. The review has resulted in the Board now expecting the Group to report a loss before tax of between GBP13.5 million and GBP15.0 million for the year. An external investigation has commenced to verify the extent of the prior year adjustments included within this loss.

The contracts involved primarily fell in the Water sector where each project has been analysed. The additional costs for 2020 have largely already been incurred and the situation is expected to have limited impact on the Group's cash position.

The Board has also undertaken a review of its financial structure following a change in payment terms on the new Framework Agreements. As a part of this exercise we have appointed Arrowpoint to advise on a medium-term debt package to sit alongside our existing overdraft facility. Furthermore, we have recently commenced a refinancing of one of the Group's property developments which will release some GBP4.0 million of cash and we have also started the sale process for some of our completed developments. We are also making good progress in negotiations to close out of our AMP6 contracts.

In the Water sector we are starting to see volumes recover from the industry AMP6 to AMP7 transition, whilst Construction has also seen some recovery having been impacted by COVID-19 delays which is also impacting the commencement of some projects in Highways. Telecoms activity levels remain strong.

Ian Elliott, Acting Chairman, commented:

"Following the announcement of the Board changes and the subsequent internal review undertaken, a number of issues have come to light which are concerning and are being addressed. Decisive action is being taken by the Board to limit the impact on the business and to ensure that the good relationships which the Group has enjoyed with its customers for many years are maintained.

I am pleased to report that activity levels and sales inquiries are encouraging and that we are close to appointing a new CFO.

The combination of the coronavirus impact and the Company's internal issues is challenging, but the Board remains confident of the market opportunity and the Group's ability to successfully address it."

Enquiries:

nmcn Plc - 01623 515008

Ian Elliott, Acting Chairman

Robert Moyle, Acting Chief Executive

Mike Holt, Audit Committee Chair

About nmcn

nmcn Plc (TIDM: NMCN) is a leading engineering and construction company in the UK. Its talented 2,000-strong team offers multi-sector engineering and construction skills, technical innovation, design, and specialist fabrication.

The Company delivers major built environment and water industry projects across the UK - from buildings and highways to large-scale water networks and treatment plants. With its history dating back to 1946, nmcn now has 12 UK offices and four off-site manufacturing facilities.

LEI Number: 213800ANYQVA5OS51A68

www.nmcn.com

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