Metalrax reports trading downturn

The Birmingham-based firm that makes and supplies specialist steel products worldwide from its two consumer durables and specialist engineering divisions, said that although trading in February represented a slight improvement over January, visibility of future trading levels was very limited. The company’s directors believed there was a wide range of potential outcomes for the 2009, but if trading did not improve further over coming months, performance was expected to fall below market expectations. Eighteen of its 19 companies are based at locations across the UK. In a trading update, Metalrax said that as a result of widespread weakness in the credit insurance market, the reduced value of assets to be disposed of from discontinued operations and the weak trading it was describing; its debt had increased above management's expectations since the year end, although it remained within its authorised limits. The company said it was in discussions with its banks to convert its existing unsecured facilities, parts of which were provided on an uncommitted basis, into secured committed facilities.