Forterra suspends dividend due to coronavirus outbreak
FTSE 250 masonry products manufacturer Forterra said on Tuesday that it was suspending its dividend and implementing a range of cost-cutting measures as it looks to weather the coronavirus outbreak.
In light of the new government guidance and to protect its workforce, the company has suspended all business operations until further notice. In some cases, this includes shutting down its facilities. Forterra said it will take "all necessary measures" to ensure its factories can efficiently resume production at the appropriate time.
It welcomed the government's announcement that funding will be available to ensure employees can still be paid a proportion of their salary during a period of furlough and said it expects to use it.
Forterra said it was entering "this uncertain time" with a strong balance sheet. It has access to a £150m revolving credit facility extending to July 2022 and has recently taken the precautionary action of drawing this facility.
"We are in regular discussion with the company's lenders, all of whom remain supportive, to understand what future funding options may be available to the company in light of recent government announcements," it said.
To protect its liquidity position, it will implement a range of cost-cutting measures in addition to halting all non-essential discretionary expenditure, which it had already done. The company will also suspend its final dividend payment of 7.5p a share.
"At this stage the board is unable to quantify what impact Covid-19 and the actions we are taking will have on the 2020 results and as such is currently unable to provide meaningful guidance on future earnings."