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Signature Aviation Suspends FY20 Guidance, Dividend Amid COVID-19; Stock Down

Signature Aviation plc (SIG.L, BBAVY), a provider of aviation support services, Monday said it is suspending fiscal 2020 guidance due to the impact from coronavirus or COVID-19 pandemic. The Board has also decided to suspend the final 2019 dividend that was proposed with full year 2019 results on March 3.

The Board will review this decision again later in the year as trading conditions become clearer.

In its trading update for the period January 1 to date, the company said its businesses, both Signature and Engine Repair and Overhaul or ERO, are essential critical infrastructure providers and as such remain both open and trading.

Flying activity across US network through to the third week of March was in line with expectations, with limited impact on fuel volumes from COVID-19.

Meanwhile, it has seen a material decline in flight activity in recent days across network of on average 65% per day as customers observe temporary stay at home orders and enforce social distancing.

The company said it has already started to take action on cost base, around 75% of which is variable.

Further, capital expenditure guidance for 2020 of $100-110 million is under review and will be materially curtailed.

In London, Signature Aviation shares were trading at 178.15 pence, down 3.9 percent.

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