Rotala sells Avonmouth depot, hedges diesel requirements

30th Nov 2018 15:55

(Sharecast News) - Rotala announced the sale of its freehold depot at Avonmouth, Bristol to Umberdata Avonmouth - a property investment company - for a cash consideration of £2.09m on Friday.The AIM-traded firm said the consideration, after transaction costs, approximated to the net book value of the assets.Of the net proceeds, approximately £1m would be used to improve the group's balance sheet through a reduction in its bank borrowings, and the remaining cash would be available for future re-investment or potential acquisitions.The company also provided the following update on its diesel fuel hedging requirements, reporting that durrently the annual fuel requirement of the group was approximately 11.5 million litres."Given the recent volatility of fuel prices, which seems likely to continue, the board has been monitoring diesel price trends closely," Rotala's board said in its statement.Rotala said that, taking advantage of the recent weakness of crude oil prices, the board had taken out a number of fuel hedge contracts, using diesel derivatives, for the year ending 30 November 2019."These hedge contracts are expected to cover approximately 52% of the group's fuel requirements for that year, at an average price of 101p per litre."The board will continue to monitor market conditions closely and take out such further fuel hedges as it deems are appropriate to meet its objective of reducing volatility and creating business certainty."