UK infrastructure engineering services group Renew saw shares fall on Monday morning after announcing the decision to close its C&A Pumps business and saying that group trading has been 'satisfactory'.
The firm said that it has been "increasingly difficult" for the pumps unit to trade profitably following changes to the water industry framework arrangements in AMP5. C&A Pumps manufactures a large range of pumps from small cellar drainers to large flood defence pumps.
C&A will be recorded as a 'discontinued business' in Renew's full-year results (financial year ending September 30th) with a trading loss of £0.3m, together with £0.3m of redundancy costs and £1.4m of non-cash asset write-downs including £0.9m of goodwill.
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The group will incur a total of £1.3m in one-offs for the year to reflect exceptional redundancy and restructuring costs.
Renew said: "The board confirms that Renew traded satisfactorily during the second half of the year and expects that its operating profit before exceptional items and amortisation will be in line with market expectations for the year."
Meanwhile, the company also announced that it has strengthened its position at Sellafield where it remains the largest mechanical and electrical contractor. The scope of its works programme on nuclear project Evaporator D has grown "substantially" and contract extensions awarded last month have increased the secured workload at the site by over £40m.
By 08:28, shares were down 2.93% at 91p.
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