Macclesfield-based engineering and thermal processing giant Bodycote said on Monday its first quarter trading “has not been significantly impacted” by disruption from the coronavirus pandemic.
“Nonetheless, given the uncertainty in the current environment the board is keeping the proposal for the final dividend under review,” said the company.
Bodycote also said it completed the $200 million acquisition of Ohio-based Ellison Surface Technologies.
Bodycote shares rose about 12% to around 548p, having plummeted from around 950p at the start of the year.
Bodycote calls itself “the world’s largest provider of heat treatments and specialist thermal processing services.”
On its recent trading, Bodycote said: “Trading in the first quarter has not been significantly impacted by disruption from the pandemic.
“Nonetheless, we have already been taking mitigating actions in anticipation of tougher conditions to come.
“These actions are designed to align our cost base with any reduced demand and we will continue to take further action in response to developments and as we deem necessary.”
On its financial position, Bodycote said: “Following the announcement today of the completion of the acquisition of Ellison Surface Technologies, Bodycote is approximately £83 million drawn on its £230 million revolving credit facility (RCF), which has two more years to run.
“Accordingly, there remains £147 million of immediately available liquidity.
“The group’s current net debt: EBITDA gearing ratio is 0.7 times, well below the 3 times covenant ceiling permitted under the RCF.
“Bodycote has a very strong balance sheet and can withstand a significant decline in trading conditions.
“Nonetheless, given the uncertainty in the current environment the board is keeping the proposal for the final dividend under review.”
Bodycote CEO Stephen Harris said: “Bodycote’s financial position is strong and our agile and devolved approach to managing the business from day to day puts us in a good position to weather the unprecedented disruption which we are likely to face.”