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Technical products and services company Diploma suspended its dividend and its outlook for the year was highly uncertain amid following a downturn in performance in April owing to the economic impact of the pandemic.
The interim dividend had been suspended, given the current uncertainty, the company said. 'Trading in April has been more challenging as it reflects the economic impact of the COVID-19 pandemic,' the company said.
Revenues fell by 28% in April by on an underlying basis and by about 16% on an actual basis. At these levels the group continued to generate good operating profits and cash flow, the company said.
'We have also taken decisive action to mitigate the impact on our business which includes freezing all capital expenditure and discretionary spend and we remain focussed on managing our working capital,' it added. 'Our executive directors, non-executive directors and the executive team have also volunteered a reduction in basic salary/fees of 20% for the duration of the crisis.'
The downturn in performance in April followed good performance in the first half of the year.
For the six months through 31 March, pre-tax profit rose 4% to £41.6m and revenue was up 9% to $283.6m on-year.
Looking ahead, the company warned of a 'highly' uncertain outlook in the second half while 'global response to Covid-19 pandemic impacts our businesses in many of our major markets.'