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Eurocell Updates On Trading; Closes Stores & Other Operations Temporarily

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Eurocell provides this update on the impact of COVID-19.

Performance for the 11 weeks to 20 March 2020 has been in line with our expectations and there has been no discernible impact on our trading so far from COVID-19.

In response to official guidance announced yesterday by the UK Government and to protect the health and wellbeing of our staff, customers and other stakeholders, we will be temporarily closing our manufacturing plants, branch network, distribution and recycling operations with immediate effect. The shut-down will be carefully controlled, in order to leave us well placed to recommence operations and trading when it is appropriate to do so. 

We have a strong balance sheet, and in March 2020 we were pleased to increase our bank facility to £75 million. We maintain a conservative approach to debt in order to ensure good liquidity and to manage any emerging risks. Net debt at 31 December 2019 was £34.6 million (on a pre-IFRS 16 basis).

Taking into account the closure and current level of uncertainty, the Board has taken the decision to cancel the final dividend payment of 6.4p per ordinary share that was proposed with the announcement of our 2019 full year results on 13 March 2020. Further prudent  actions we have taken to preserve cash include deferral of non-essential operating costs and the vast majority of planned capital expenditure whilst our operations remain closed. We will also make use of any tax payment relief, the Coronavirus Job Retention Scheme and other Government measures as they become available.

We will provide further updates when there is greater clarity on the impact of COVID-19 on the Group.

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25 March 2020

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