Shares of Manchester-based household products firm McBride plc rose about 5% on Wednesday after it said its banking group has waived December 2021 covenant tests.

The company said it is working with its banking group to agree the June 2022 covenants ahead of McBride announcing its interim results for the six months ending December 31, 2021.

On December 16, McBride said it expects to make a bigger loss than anticipated for the six months ended December 31, 2021, amid “rapidly rising” costs, “shortage of haulage capacity” and ongoing supply chain problems.

McBride is one of Europe’s largest makers of retailer own brand household goods.

“Further to our announcement of 16 December 2021, we are pleased to announce that our banking group has waived the December 2021 covenant tests,” said McBridde.

“In reaching the agreement of the waiver, the group has agreed to maintain liquidity (cash plus facility headroom) of at least £40 million.

“As referenced in the announcement on 16 December 2021, McBride continues to benefit from a strong liquidity position with c.£80 million in available additional funding.

“Furthermore, the group has agreed not to pay dividends until it is in compliance with its existing covenants.

“The group is working with its banking group to agree the June 2022 covenants ahead of McBride announcing its interim results for the 6 months ending 31 December 2021.

“We are fully appreciative of the ongoing support that the banking group are giving to the group through this period of uncertainty caused by the rapid and unprecedented rise in input costs and the ongoing macroeconomic supply chain challenges.”