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Student and rental focused property developer Watkin Jones said it expected to report first-half earnings and revenue in line with it expectations, but would not declare an interim dividend due to the worsening Covid-19 crisis.
The company also said it expected to incur costs in the range of £12m-to-£15m over the next two-to-three years to improve the integrity of cladding systems following new government guidelines.
Watkin Jones said it had began to experience significant disruption to its operations in the latter part of March due to Covid-19, with non-essential work halted at its construction sites.
The company withdrew its financial guidance for the full year and said it would reinstate its dividend as soon as appropriate.
Watkin Jones said all of its developments had been constructed in compliance with prevailing building regulations at the time.
However, given the change to government guidance, it had decided to engage with building owners to ensure any changes were made as expediently as possible.
A one off non-underlying provision for the estimated costs would be made at the year end.
'The group believes it may be able to recover some of this cost from the sub-contractors and consultants engaged on implementing the particular cladding systems at the time,' it added.
'This is likely to take an extended period of time to achieve and the extent of any recovery is currently uncertain.'
At 2:51pm: (LON:WJG) Watkin Jones PLC share price was -3.2p at 151.4p