16 October 2017 – board changes/trading update
The group has announced a board restructuring which has seen the resignation of chief executive Stewart Davies with non-executive chairman Jim Meredith moving into an executive role. The company has also appointed two new non-executive directors, including Roger McDowell who was a board member for 11 years between 2004 and 2015 including stints as interim CEO and interim chairman. His experience should prove invaluable at this difficult time. The company continues to be in discussions with HMRC regarding the claim for landfill tax and no resolution is expected for some time. The group has also stated that trading continues to be weaker than expected and another round of cost cutting has been undertaken which will save £1.7m annually. The cost of this will be £0.9m and this will be taken in the current financial year. Given these uncertainties we maintain our recommendation of HOLD.