Churchill China PLC
9 November 2001
For Immediate Release 9 November 2001
Churchill China plc
Trading update
The Board of Churchill China plc has reviewed the Group's expected trading
position in the light of current worldwide market conditions and now
anticipates that its profits for the year to 31 December 2001 will be below
current market estimates but will still be well ahead of corresponding figures
for the previous year. It is expected that the profit recovery established in
2000 will continue, but that the rate of this recovery will be reduced.
Following the conclusion of detailed discussions with customers, particularly
in North American markets, where the Group had sales of over £8m in the year
to 31 December 2000, it is now apparent that sales will not reach previous
expectations. The majority of this shortfall is likely to be in the Group's
Dining In division where a number of orders from retail chains have been
cancelled and business with supermarket continuity programme operators will be
below last years levels.
Sales in the important UK Dining Out market continue to make progress over
last year coming into the key pre - Christmas trading period. The Board
anticipates that current trading performance in this market will continue.
Other geographical markets are relatively unaffected.
A number of cost reduction measures have been implemented to offset the effect
of reduced sales levels although these are unlikely to have a significant
benefit in the current year. The Board will also accelerate the development of
a number of growth areas within the business in order to respond to changed
market conditions.
The Group continues to generate good operating cash flow and to maintain a
positive cash position. The Board has no plans to modify its current dividend
policy.
For further information please contact:
Stephen Roper - Churchill China plc 01782 577 566
Tim Anderson - Buchanan Communications 020 7466 5000