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Meggitt assures on finances as it leads ventilator consortium
19th Mar 2020 07:35
(Sharecast News) - Aerospace and defence engineering company Meggitt updated the market on its trading, and its financing and liquidity position on Thursday, reporting that in light of the Covid-19 coronavirus pandemic and its impact on the global economy and the aerospace sector, its focus in recent weeks had been on ensuring the safety of its employees and the continuity of our operating businesses worldwide.
The FTSE 100 firm noted that it employs more than 12,000 people across 42 sites in 10 countries.
It said that, in providing guidance and advice to its employees, it was continuing to follow World Health Organisation guidelines, supplemented by input from the local authorities in the regions in which it operates.
"We continue to review and update our advice on a daily basis as the situation develops," Meggitt said.
The company said that, despite a "rapidly changing" external environment, trading in January and February was in line with its expectations.
Details of its trading performance in the first quarter of 2020 would be contained within its first quarter trading statement, which was scheduled for release on 23 April.
"Whilst the near term demand outlook for our products and services continues to evolve and remains uncertain, we have put in place a broad range of measures to significantly reduce cost and manage our liquidity over the coming months," the board said.
As it reported at its full year results on 25 February, as at 31 December Meggitt's borrowing and financing position included net debt, including leases, of ?911m, of which ?758m was bank and other borrowings net of cash, and ?153m related to leases.
Its net debt-to-EBITDA ratio was 1.8x on a reported basis, and 1.5x on a covenant basis, compared with its covenant limit of 3.5x.
The company's interest cover was 16.3x, compared with our covenant of interest cover being greater than or equal to 3.0x.
At the end of 2019, the firm had ?1.56bn of committed facilities in place, providing headroom of ?806m above its net borrowings of ?758m.
In 2020, it had $275m of debt maturing, for which it had fully committed facilities in place, entered into during December.
The company said those facilities consisted of three bilateral loans extending to at least December 2022.
Within its committed facilities of ?1.56bn at 31 December, it said it had a $750m revolving credit facility available, that was due for renewal in September 2021.
"In response to the UK government's request for additional medical ventilators, Meggitt is leading a consortium of UK aerospace suppliers working to develop and produce, in large volumes, a ventilator that meets their requirements for a rapidly manufactured ventilator," the board said.
It added that at the current time, and in light of a "highly fluid market" and global macroeconomic situation, it was too early to provide earnings guidance for the rest of the current financial year.
"We have put in place a set of measures to tightly manage the business and navigate our way through these challenging times.
"We will continue to monitor external events and manage the situation closely and will keep the market updated on developments as appropriate."
The FTSE 100 firm noted that it employs more than 12,000 people across 42 sites in 10 countries.
It said that, in providing guidance and advice to its employees, it was continuing to follow World Health Organisation guidelines, supplemented by input from the local authorities in the regions in which it operates.
"We continue to review and update our advice on a daily basis as the situation develops," Meggitt said.
The company said that, despite a "rapidly changing" external environment, trading in January and February was in line with its expectations.
Details of its trading performance in the first quarter of 2020 would be contained within its first quarter trading statement, which was scheduled for release on 23 April.
"Whilst the near term demand outlook for our products and services continues to evolve and remains uncertain, we have put in place a broad range of measures to significantly reduce cost and manage our liquidity over the coming months," the board said.
As it reported at its full year results on 25 February, as at 31 December Meggitt's borrowing and financing position included net debt, including leases, of ?911m, of which ?758m was bank and other borrowings net of cash, and ?153m related to leases.
Its net debt-to-EBITDA ratio was 1.8x on a reported basis, and 1.5x on a covenant basis, compared with its covenant limit of 3.5x.
The company's interest cover was 16.3x, compared with our covenant of interest cover being greater than or equal to 3.0x.
At the end of 2019, the firm had ?1.56bn of committed facilities in place, providing headroom of ?806m above its net borrowings of ?758m.
In 2020, it had $275m of debt maturing, for which it had fully committed facilities in place, entered into during December.
The company said those facilities consisted of three bilateral loans extending to at least December 2022.
Within its committed facilities of ?1.56bn at 31 December, it said it had a $750m revolving credit facility available, that was due for renewal in September 2021.
"In response to the UK government's request for additional medical ventilators, Meggitt is leading a consortium of UK aerospace suppliers working to develop and produce, in large volumes, a ventilator that meets their requirements for a rapidly manufactured ventilator," the board said.
It added that at the current time, and in light of a "highly fluid market" and global macroeconomic situation, it was too early to provide earnings guidance for the rest of the current financial year.
"We have put in place a set of measures to tightly manage the business and navigate our way through these challenging times.
"We will continue to monitor external events and manage the situation closely and will keep the market updated on developments as appropriate."