RNS: Business Update
Thursday, 23 April 2020
Synectics plc (AIM: SNX), a leader in the design, integration and support of advanced security and surveillance systems, provides the following update ahead of its Annual General Meeting (“AGM”) to be held later this morning.
Further to the Company’s announcement of 23 March 2020, the Board continues to closely monitor the effect of the Coronavirus (COVID-19) pandemic on Synectics’ customers, business and employees. Management is making necessary decisions daily to meet the evolving situation and is closely following all national government regulations and guidance wherever the Company operates.
The Company has a solid cash position and measures in place to ensure that it remains financially sound during this period of uncertainty and beyond. The Group’s available consolidated net cash balance was £3.3 million as of 20 April 2020, with confirmed facilities of £5.0 million in place if required.
The Board has taken mitigating actions to preserve the Group’s cash and protect the business, including:
- Reducing temporarily salaries and fees for the Board and senior management team across the Group;
- Utilising the UK Government’s Job Retention Scheme in order to protect jobs, with 30% of the Company’s UK workforce having been furloughed in two tranches during April;
- Applying for support, as appropriate, from government schemes in the US, Germany and Singapore designed to protect jobs; and
- Suspending all discretionary spending, recruitment and capital expenditure in addition to withdrawing the resolution to recommend payment of the final dividend at the AGM.
All the Company’s business units are currently operating, but at significantly reduced levels of activity in every sector and geography. Reasonable levels of design and planning work are continuing for projects now expected to proceed later in the year than originally anticipated.
We continue to provide essential service and support to our customers on-site where required and have increased our remote support capabilities. The Company’s business is to provide security and safety systems; employees and customers are well aware of the role they play in protecting communities around the world and we are making every effort to ensure that customers can continue to rely on us at this difficult time.
Planned investment in software development continues, with only limited impact as a result of COVID-19.
With most staff working from home and others furloughed, we have instigated a specific programme to keep colleagues connected to the business and each other. The Group is making extensive use of video conferencing and other communication tools to facilitate continued effective teamwork and to minimise any potential sense of isolation.
Synectics’ priorities continue to be:
- to protect the health and well-being of its employees and customers;
- to provide ongoing support to its customers, especially where we are providing essential security and safety; and
- to manage the business for the long term by prudent actions to preserve cash and maintain capability.
As announced on 23 March 2020, and given the continued uncertainty in global markets, financial guidance on the Company’s expected trading performance for the financial year ending 30 November 2020 has been and remains suspended.
Regular updates are provided on the Company’s website and further announcements will be made as appropriate.
David Coghlan, Chairman of Synectics, commented:
“Synectics is a global business with a solid balance sheet, and we have taken immediate measures to contain costs and protect our financial position.
“The Company fills a number of important roles in the wider security and surveillance industry. The Board is determined that Synectics will maintain its skills, resources and product development momentum and, by doing so, be well-placed for new opportunities that will undoubtedly emerge as we reach the other side of the current hiatus.”
For further information, please contact:
Paul Webb, Chief Executive
David Coghlan, Chairman
Tel: +44 (0) 114 280 2828
Tom Griffiths / Henry Willcocks
Tel: +44 (0) 20 7408 4050