# Chamberlin Trading stalled in these unprecedented times

- Link: https://www.directorstalkinterviews.com/chamberlin-trading-stalled-in-these-unprecedented-times/412810439
- Published: 2020-03-30T13:23:13+01:00
- Author: Amilia Stone

**Chamberlin plc** (LON:CMH) recent trading update revealed that trading is stalling
in these challenging times. The company, however, is taking appropriate strategic
actions. The group has been financially de-risked, and the shares remain appropriately
valued against the peer group on most methodologies, in our view.

 * **Trading update:** Trading for the current year to 31 March 2020 is expected
   to be in line with market expectations; however, given the current ongoing uncertainty
   of future customer demand, management expects that revenue will be substantially
   reduced in the early months of 2020/21.
 * **2020/21 forecasts:** As a consequence, forecasts are unpredictable and somewhat
   inappropriate. The company is benefiting from recent restructuring initiatives
   with a reduced operating cost base. Management is focused on cash preservation
   and will take advantage of UK government measures to support businesses.
 * **Business developments:** The Walsall foundry and Machine Shop will close for
   a minimum of three weeks in April, reflecting the COVID-19 impact on the global
   automotive industry. The Scunthorpe foundry and Petrel will remain operational
   and are currently trading in line with management expectations.
 * **Risks:** Potential risks include developments related to the COVID-19 pandemic,
   the global automotive industry and Brexit uncertainties. From a financial standpoint,
   the group has been significantly de-risked, with the recent Exidor disposal proceeds
   used to reduce the pension scheme deficit and pay down debt.
 * **Investment summary:** The shares offer the opportunity to invest in a cyclical
   stock with a valuation that we consider fair compared with the peer group. Chamberlin
   are likely to tread water, however, until significantly brighter prospects become
   more evident.

[DOWNLOAD THE FULL REPORT](https://www.hardmanandco.com/wp-content/uploads/2020/03/Chamberlin-plc-Mar-2020.pdf)

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