RNS Number : 4390T
Wensum Company PLC
05 June 2009
5 June 2009
The Wensum Company plc
('Wensum' or the 'Company')
Wensum today announces an update on current trading.
The Company announced on 6 April 2009 that adverse exchange rate movements had created substantial pressure on gross margins during the last months of 2008 and the first quarter of 2009, and that this pressure, coupled with a sharp downturn in sales due to general trading conditions and exceptional acquisition and restructuring costs, had given rise to significant trading losses for the period ended 31 December 2008 which would continue during the first half of the current year. The Company stated that the board was examining various means of improving its liquidity position which had come under pressure as a result of these factors.
Trading for the first five months of the current calendar year has been below forecast, but the group has won three major contracts which it is hoped will contribute towards a recovery in like-by-like sales in the second half year and 2010.
The acquisition for a non-cash consideration of Allen & Douglas, announced on 19 May, has improved the group's short term liquidity and sales outlook, with prospects for a further improvement in overhead ratios.
Nevertheless, the group's poor trading performance in the year to date has severely weakened the Company's financial position. Liquidity remains under pressure and the Company needs to secure additional funds in order to meet its short term working capital requirements.
The board, together with its professional advisers, is exploring various ways of addressing this situation and the Company will make a further announcement in due course.
Stuart Lyons, Chairman
020 7352 3309
Smith & Williamson Corporate Finance
(Nominated Adviser and Broker)
020 7131 4000
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