Low & Bonar released a trading update today, revealing it expects results for the period to be in line with the board’s expectations as on 20 May 2019. In addition to the previous announcements, group sales for the period were approximately 8% lower compared to the previous year. The group expects a small underlying PBT for the period.
Net debt as on 31 May 2019 was approximately £99m, representing an expected net debt to EBITDA ratio of c2.9x, within the banking covenant of 3.5x, as expected. On a pro forma basis, assuming the equity raise that took place in the first quarter of this year occurred on 1 December 2018, average net debt for the half was £114m. Though, interest cover for the twelve months to 31 May 2019 is expected to be c3.3x, ahead of the banking covenant of 3.0x.
In other news, the company confirms that the disposal process of its civil engineering division continues to progress, the recently announced sale of the construction fibres business is expected to complete in early July and the sale of the needle-punched non-wovens business is still expected to be completed during the current financial year.