Portmeirion Group PLC (LON:PMP) saw some value chipped off its shares on Tuesday as the group warned its business had been “significantly impacted” by the coronavirus pandemic and the disruption was expected to continue into its second quarter.
In an update ahead of its annual general meeting later today, the Stoke-on-Trent-based pottery maker said it had partially reopened its factory on 6 May at a reduced capacity to fulfil existing export orders, having temporarily shut down production in March, and that capacity was expected to increase in the coming weeks.
Portmeirion also said that its UK home fragrance company, Wax Lyrical, had repurposed production lines to make hand sanitiser for the community, NHS and pharmacies and is expected to shop over 1mln units during the second quarter of the year.
However, despite the factory reopening the group said the shutting down of retail stores across the world had hit its business hard and the impact was expected to continue across the second quarter until there was more clarity on reopening.
Despite this, the firm said it had continued to ship export orders to the Far East where retail stores had reopened and had also seen a “significant uplift” in its online orders from the UK and US with sales from its ecommerce site up by more than 100% year-on-year in April, a trend that was expected to continue over the coming months.
Portmeirion added that actions taken to reduce its cash burn will put it in “a strong position to thrive once lockdown restrictions are lifted”, with the company expecting its cash burn to be less than £1mln for the second quarter of the year.
The firm also said that it will reinstate its dividend payments “as soon as we feel it prudent so to do”.
“We have a robust strategy to leverage our powerful portfolio of homeware brands. Throughout the pandemic we have continued to focus on and progress our new product development pipeline and invest in growing our online sales channels”, the group said.
The company’s shares slipped 2.1% to 370p in early deals.