Jarvis admits bank debt talks

TROUBLED rail engineer Jarvis today said its annual results are to be delayed by up to six weeks and admitted it is in talks with its lenders over fears it could breach its banking covenants.

Jarvis had been expected to report sharply falling profits and a steep increase in debt in the second week of June - the week its chairman, Steve Norris, goes to the polls as Conservative candidate for London Mayor.

Jarvis's director of communications, Jonathan Haslam denied a delay in the results was linked to trying to suppress the news at the height of Norris's campaign.

'Hand on heart, this is not the case,' he said. 'The market is already expecting disappointing results so they would not be a blinding surprise, would they?''

City analysts believe Jarvis's debt levels have soared by more than 50% in the past year to about £130m, putting the company in danger of breaching agreements made with its lead bankers, Barclays and Royal Bank of Scotland.

Jarvis said that a restructuring by chief executive Kevin Hyde will not be finalised until July, at which time it will announce its results for the year to end-March.

It added: 'As certain of the group's banking facilities expire from March 2005, the board has started discussion for their renewal. The board is mindful that material change to the group's strategy and position may require the consent of the group's lenders and therefore lenders are being kept informed of the progress of the review.'