|
Churchill China PLC on Wednesday said it believes it is performing well within a difficult trading environment, as it cut its dividend amid an interim revenue and profit fall. The Stoke-on-Trent, England-based ceramics manufacturer said pretax profit fell 35% to £3.1 million in the first half of 2025, from £4.8 million a year ago. Revenue declined 5.2% to £38.5 million from £40.6 million. Churchill China slashed its interim dividend by 39% to 7.0 pence per share from 11.5p a year ago. The company noted that North America performed well with Hospitality sales 1.6% higher despite ‘turbulence around tariffs.’ In Europe, markets were more difficult as Germany struggled in particular, meanwhile competitor intensity is higher than the UK which puts more pressure on pricing. Further, rest of the world markets experienced a ‘very difficult’ first half as market conditions were challenging for independent restaurants, amid a reduction in new project installations due to customer delays and lower value transactions. Churchill China said it expects markets to recover in the medium term, while it is ‘performing well within what is currently a difficult trading environment.’ It added that it remained a well invested business in structured markets with a high percentage of its revenue originating from replacement orders at good margins. Chair Robin Williams said: ‘Global hospitality markets remain depressed by weak consumer sentiment and rising employment costs. We believe we are maintaining share in key territories, and in the UK and USA we have performed better than the market. Our focus internally is on reducing our cost base without damaging core skills and on employing capital spend to bring down cost of production and enable new product launches at competitive price points.’ Regarding the UK, Churchill China said: ‘We are pushing local representatives to assist with the current blockage on new solar generation installations. Current projections are that new solar generation will not be able to be added to the local grid until 2032 hampering our transition to a lower carbon environment.’ Looking ahead, Chair Williams said: ‘Whilst the performance in the period has been lower than last year, the board believe that the company is taking all necessary actions in what is currently, a difficult trading environment. We continue to win a good percentage of new projects, and we have a robust order pipeline supported by replacement orders Despite the drop in sales we are confident that this is driven by market contraction rather than loss of market share. We continue to strengthen both our product proposition and manufacturing capability, further improving our brand and market position in preparation for the recovery in investment levels in the hospitality industry.’ Churchill China shares were up 0.2% at 431.00 pence each on Wednesday morning in London. Copyright 2025 Alliance News Ltd. All Rights Reserved.
|
