Porvair warns of interim loss

7th Apr 2009 08:32

Porvair lost more than a quarter of its value Tuesday after the industrial filter maker warned it is likely to report a first-half loss due mainly to redundancy costs in the US.Business was good in the UK and Europe during the four months ended 31 March, said the firm, but a deterioration in US trade forced a 40% cut in staff that's likely to result in a one-off charge of about £600,000.Sales in the US Metals Filtration division fell around 15% early in the year, and by another 20% during February and early March. But redundancies will lower annual costs by around £1.5m."To reflect current trading, the board has amended its expectations for the year," it said. "Including one-off costs, mostly US redundancies, the group is likely to incur a small operating loss in the first half of the year."But it believes the things will improve later in the year. "Cash generation should remain in line with management plans," it said. "Expectations of a stronger performance in the second half are underpinned by orders in the UK due for delivery later in the year and the much lower US cost base."There'll be a further update on trading at the end of its half year in early June. A full interim statement will be made on 22 June.