Amino Technolgies cancels divi as China production returns

Media and entertainment technology company Amino Technologies updated the market in light of the Covid-19 coronavirus pandemic on Monday, reporting that it had implemented parts of its business continuity plan to enable all its global staff to work remotely.

The AIM-traded firm said the measures taken had ensured that service delivery and customer support had continued as normal, while also carrying out its duty of care for staff, customers, partners and families.

It said its Hong Kong office had been operating in that mode for more than two months.

“We are now enabling our customers to meet this latest disruptive challenge,” Amino’s board explained in its statement.

“Our teams are working diligently to ensure that our video streaming services and apps keep up with increased usage.

“In addition, we are supporting our customers with tools and services that can help with social distancing.”

Amino said that comprised solutions that could remotely manage, support and install devices in the home, and which therefore removed the need for engineers to visit the home.

The company reported on 27 February, when its announced its results for the year ended 30 November, that factories in China were closed for longer than usual over the Lunar New Year holiday.

It said on Monday that, following the resumption of production on 10 February at a reduced capacity, production was now back to normal levels, although with challenges resulting from the irregular flow of raw materials in the region.

“Clearly, the outlook for the group's financial performance for the remainder of the financial year is uncertain due to the disruption now seen in the economies of the countries in which our customers operate caused by the Covid-19 pandemic.”

Amino said it had a “strong” balance sheet and “robust” liquidity, adding that its board was taking a “prudent approach” to preserve the firm’s liquidity and cash position, including the suspension of dividends until market conditions stabilised.

The company had gross cash as of Monday of $3.2m, drawn credit facilities of $4.5m and undrawn credit facilities of $10.5m.

“Our successful ongoing shift to a software and services model underpins the board's confidence in our long-term strategy and opportunity,” the directors said.

On 27 February, the board recommended a full year dividend of 7.32p per share for the year ended 30 November, meaning that a final dividend of 5.637p per ordinary share was subject to shareholder approval at the annual general meeting, scheduled for 2 April, given an interim dividend of 1.683p had already been paid in August.

“This recommendation was made at a time when it was not possible to foresee the impact of Covid-19 on the economies of the countries in which our customers operate,” the company said.

“The board no longer recommends the payment of the final dividend and therefore is withdrawing AGM resolution 3.

“This will result in the retention of approximately $5.3m in cash within the business.”

Additionally, in light of the pandemic and travel restrictions imposed by the UK government, Amino said it intended to adjourn the AGM so that it could be held with the minimum number of physical attendees in a manner consistent with the restrictions.

“A further announcement will be made in due course as to the time and place of the adjourned AGM.”

At 1547 BST, shares in Amino Technologies were down 4.22% at 113.5p.