Churchill China optimistic after tough 2020

Hospitality ceramics manufacturer Churchill China reported operating profit before exceptional items of £0.9m in its preliminary results on Monday, down from £11.2m year-on-year.

The AIM-traded firm said its profit before exceptional items and tax slid to £0.8m for the year ended 31 December, from £11.2m, while its reported profit before tax after exceptional items was £0.1m, compared to £11.3m a year earlier.

Adjusted basic earnings per share plunged to 6.5p from 81.7p, and basic earnings per share came in at 1p, down from 82.6p.

Net cash and deposits at year-end stood at £14.0m, down from £15.6m a year earlier, while cash generated from operations during the year totalled £1.8m, compared to 2019’s figure of £11.3m.

Total revenues for the year stood at £36.4m, almost half of the £67.5m it reported in 2019, although the company did report a “strong” pre-Covid-19 performance.

The board said the firm’s response to the pandemic demonstrated its resilience, as it made further investment for the long-term.

Progress was reported on the implementation of Churchill’s strategic plans, with the introduction of further added-value products, and the development of distribution channels in key export markets.

The company also said it had extended its “technical differentiation”, and established a Europe distribution centre.

“We believe that we are well positioned to respond to the forthcoming re-opening of our markets and have an improved competitive position supported by a sound operational and financial base,” said chairman Alan McWalter.

“Churchill is a long established, resilient business with strong foundations.

“We believe that we are well placed to build momentum in our trading performance throughout the rest of the year.”

At 1417 BST, shares in Churchill China were up 0.6% at 1,499p.