Watlington Waterworks feels effect of pandemic
Watlington Waterworks Ltd has entered “unchartered waters” after a reduction in demand from major customers, such as hotels and restaurants, due to the impact of the Covid-19 pandemic.
The company had a strong first three months of the year, but this was brought to a halt when pandemic emergency measures took effect in late March and April.
The company’s directors, in a report to shareholders, said: “As an essential service the company’s utility and bottled water divisions continued operations throughout the shelter in place period, while the retail shop was closed through most of April and initially reopened with kerbside service and later with restricted access.
“The closing of Hamilton and all hotels and restaurants reduced demand for our products and services in key areas. Without the larger customers, utility operations became more difficult due to higher demand volatility depending on rain.
“For bottled water, the closing of commercial customers created a slump in five-gallon bottle sales. This was partially offset by higher three-gallon sales as retail sales through the grocery and convenience stores increased during shelter in place restrictions.”
The directors said the company remains financially strong although earnings will be substantially down due to Covid-19 related closures and reduced operations.
They remain committed to the company’s long-term investment plans and maintaining its dividend, subject to earnings and cashflow.
The directors added: “There is an element of uncertainty about how changes induced by the pandemic experience will affect the company going forward but there remain core infrastructure strengthening and replacement projects, which should continue because of the long-term benefits to be derived from these projects.
“We have entered uncharted waters due to the pandemic. We will have to adapt as necessary and a full recovery may take longer than anticipated. This is beyond the company’s control; in the meantime, the company will continue to work at strengthening infrastructure to sustain our quality of products and services.”
The company also announced that Michael Darling, one of its directors, has retired from the board. He was appointed in May 1991, and was the second longest serving member of the current board.
Watlington Waterworks thanked Mr Darling “for his valuable contributions over the years in the furtherance of the company’s business”.
In addition, Patrick Dill has been appointed as chairman of the board, and Dr Nicholas Glynn has assumed the role of deputy chairman.
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