Produce Investments PLC Trading Update (7930O)
May 22 2018 - 5:43AM
UK Regulatory
TIDMPIL
RNS Number : 7930O
Produce Investments PLC
22 May 2018
22 May 2018
PRODUCE INVESTMENTS PLC
Trading Update
Produce Investments plc, (AIM:PIL) ("Produce," "Company" or the
"Group"), a leading operator in the fresh potato and daffodil
sectors, is today providing an update on current trading.
In our Interim Results announcement on 22 March 2018, the Board
highlighted the potential impact of the unseasonal spring weather,
particularly on the businesses of Jersey and Rowe. The adverse
weather presented significant challenges both to planting of our
early season potato crops in Cornwall and Jersey and also to the
harvesting of our daffodil crop. On Jersey, the rainfall recorded
during the four months from December 2017 to March 2018 saw an
increase of 46% over the long term average with the number of dry
days reduced significantly. Mean temperatures during the critical
growing months of February and March were also negatively impacted
by c. 20% versus the long term average.
As a result of these factors, as well as the previously flagged
lower margins on 2017 UK potato crops and reduced seed volumes and
margins due to an oversupplied UK market, the Board now expect the
Group's profit for the year ending 30(th) June 2018 to be
substantially below current market expectations.
Rowe and Swancote are subject to annual intangible asset
impairment testing and the results and assumptions relating to the
last tests were disclosed in the 2017 Annual Report. Due to the
challenging trading conditions described above the Group' s current
trading performance is below some of the assumptions made in the
2017 impairment tests. Accordingly, we have already commenced work
on the 2018 year-end testing which will be based on board approved
budgets and forecasts and will be subject to audit in due course.
It is too early to quantify the results of the impairment testing,
but the Board would expect the tests to result in a significant
"non cash" impairment which will reduce "unadjusted" reported
profits for the year.
Finally, in light of the timing of the potato harvest on Jersey,
which can straddle our current year end, and makes our full year
outturn heavily dependent on the final months of the financial
year, the Board has decided that going forward it would make sense
to move the Group's year end to the end of August. This will
greatly assist with the Group's internal budgeting process and will
enable the Board to provide more certainty on full year
expectations. This change, which is subject to regulatory approval,
would not come into effect until the beginning of the next
financial year at the earliest. A further update on the
implementation of this move will be provided in due course.
The Group remains cash generative and is committed to its long
term strategy of widening both its product base and customer base,
creating a more diverse business model for the future.
For further information contact:
Produce Investments plc
Angus Armstrong
Jonathan Lamont +44 (0) 1733 372 515
Shore Capital (Nomad)
Stephane Auton / Patrick Castle +44 (0) 20 7408 4090
Powerscourt
Nick Dibden
Jana Tsiligiannis
produce@powerscourt-group.com +44 (0) 20 7250 1446
Notes to Editors
The Group is a vertically integrated company supplying blue chip
retail customers with potatoes and daffodils.
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END
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