Shares of Barrow-in-Furness international marine engineering company James Fisher and Sons plc fell about 9% on Tuesday after it said its revenue fell 10% to £258.1 million in the six months ended June 30, 2020, and profit before tax fell 59% to £7.1 million.
James Fisher is proposing an interim dividend per share of 8p, down from 11.3p, and said its financial performance in 2020 will be lower than 2019.
Fisher’s share price fell 9% to around £11.16 to give the company a current stock market value of about £560 million. The firm’s stock price has fallen almost 50% in the past 12 months.
The Barrow firm said its 3,000 employees produced a “resilient” performance during the challenging first half of the year.
“Since the third week of March, approximately 70% of our office-based staff have been working from home, made possible by our past investment in the appropriate technology …” said James Fisher.
“The group took swift actions to reduce costs, optimise cash flow and protect liquidity.
“This included the deferral of all discretionary capital expenditure, instituting a hiring freeze, placing approximately 400 UK employees on furlough and implementing a 20% pay deferral for approximately 800 employees across the world.
“The deferred pay will be repaid to our employees during the second half of the current year, with the exception of all board members, the executive committee and our senior leadership team, who have agreed that their pay reduction of 20% for the second quarter will not be reimbursed.
“The group has returned to full salaries with effect from 1 July 2020 and has ceased to take advantage of the UK Government’s furlough scheme since July.
“In addition, the group has deferred payment of cash bonuses in relation to the 2019 financial year until July and deferred payments of taxes where possible and defined benefit pension scheme contributions, with the agreement of the Pension Trustees.
“We announced on 26 March 2020 that the payment of the final dividend in relation to the year ended 31 December 2019 had been suspended as part of our response to protect the group’s liquidity going into the Covid-19 lockdown and we have now taken the decision to cancel this dividend.”
James Fisher CEO Eoghan O’Lionaird said: “The first half of 2020 was one of the most demanding periods the company has faced, and the commitment, support and engagement of our employees in stepping up to the challenges has been remarkable.
“The group responded swiftly to both the unprecedented headwinds presented by Covid-19 and the longer-term implications for energy demand by taking actions to reduce costs and protect the group’s liquidity.
“Whilst the second half is expected to remain challenging and the outlook for our end markets is uncertain, we expect trading to improve through the second half, assuming no material deterioration in the Covid-19 situation.
“James Fisher is well diversified by geographical sector and end market.
“The resilience of the group, our strong liquidity position combined with swift actions taken to reduce costs, position James Fisher well for any improvement in market conditions in the second half and beyond.
“Whilst the financial performance in 2020 will be lower than 2019, the group remains well placed to deliver future growth for its shareholders.”