COVID-19 and dividend update
Gateley (Holdings) Plc (AIM:GTLY), the legal and professional services group, provides an update to shareholders regarding current and future trading and the impact of the COVID-19 pandemic.
Gateley is prudently managed for organic and diversified growth, with low levels of debt and a focus on long-term success for its stakeholders. Following a solid first half performance and further diversification by completing four earnings enhancing acquisitions, the improvements in the economic backdrop and Brexit clarity following the general election resulted in growing demand for our services in the second half of the financial year to 30 April 2020. Trading until the end of February was in line with the Board's expectations. Activity has, understandably, reduced since 1 March 2020, as a result of the disruption caused by the COVID-19 pandemic to our clients and to our staff. When the Board has visibility on the impact of the virus on the Company's full year performance, we will provide a further trading update.
The Group remains highly resilient, with a strong client base and a well-balanced and diversified service offering. We have successfully mobilised our staff to work from home in line with all Government guidelines and many parts of the business are currently busy assisting clients with COVID-19 related issues as well as other ongoing matters. The Board has, nevertheless, given careful consideration to the rapidly evolving Government guidance in respect of the COVID-19 pandemic and has concluded that it is presently impossible to predict the Group's likely trading performance in the short-term. The Board is, therefore, taking the prudent step to suspend financial guidance going forward until both the impact and duration of the COVID-19 pandemic becomes clearer.
The Board also believes that it would be prudent and in the best interests of all stakeholders to maximise the Group's short-term liquidity. With this in mind, it has decided to cancel the Group's interim dividend of 2.9 pence per share, which was due for payment on 31 March 2020.
Michael Ward, Gateley Chief Executive Officer, said:
"As a Board, we consider these measures to be in the best interests of all our stakeholders. Gateley is a resilient and well-balanced business and our economic and geographically diversified business model is well-placed to withstand difficult economic conditions.
"On behalf of the Board, I thank all of our people for their continued dedication and hard work under these extremely challenging circumstances and for ensuring that our clients continue to receive the outstanding level of service which they have come to expect from Gateley."