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Franchise Brands B2B arm classed as essential during coronavirus crisis

Snapshot

  • Comprises Metro Rod, ChipsAway, Barking Mad and Ovenclean.
  • Looking for more acquisitions
  • Shares have doubled over past twelve months
drainpipes

Quick facts: Franchise Brands PLC

Price: 107.5 GBX

AIM:FRAN
Market: AIM
Market Cap: £102.38 m
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We have started to look for more bolt-on acquisitions with the integration of drain maintenance business MetroRod now largely finished.

Stephen Hemsley, executive chairman

How it's doing

Franchise Brands PLC (LON:FRAN)  B2B operations - MetroRod, Metro Plumb and Willow Pumps - have been deemed essential operations by the government and continue to operate normally.

The group's three consumer-facing businesses, however, have seen demand drop in the current crisis and franchise fees have been cut to help them survive.

Franchise Brands says its objective is to run the B2C side of the business at cash break-even while the crisis persists.

Volumes will be lower in B2B, but this division is still expected to trade profitably after a round of cost cuts.

 

What the boss says: Stephen Hemsley, executive chairman (in March) 

“We do expect to remain profitable overall, albeit at lower levels than originally anticipated.

"We have a robust balance sheet, which, in combination with the utilisation of the various government schemes, will enable us to support our people and franchisees during this challenging period.

“Metro Rod, Metro Plumb and Willow Pumps, with almost 450 engineers operating from nearly 50 depots around the UK, continue to provide essential services to ensure that the country's drains and water run smoothly throughout this crisis.”

Inflexion points

  • B2B businesses Metro Rod, Metro Plumb and Willows Pumps deemed essential services
  • Expected to remain profitable in 2020 as a result
  • B2C business run on a cash break-even basis while coronavirus crisis persists

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Franchise Brands PLC has eye on expansion after £14mln fundraise

Stephen Hemsley, executive chairman of Franchise Brands PLC (LON:FRAN) is confident the B2B business will come out strongly from the coronavirus lockdown. “We can trade through the crisis in profit,” he told Proactive. “And once we come out the other side, the drain maintenance businesses...

on 24/4/20

2 min read