Jarvis extends loan facilities

JARVIS, the rail services group, said yesterday it had been granted extended banking facilities until 2011.<br /><br />But the deal with Burdale Financial Limited, a subsidiary of Bank of Ireland and Bank of America, will see its asset backed loan facility reduced to &pound;50m from &pound;60m.<br /><br />Jarvis, which has contracts with National Rail including signalling projects, was hit earlier this year as the transport group delayed its repairs timetable.<br /><br />The loan facility is backed by the group&rsquo;s assets, which include receivables &ndash; money owed to the company.<br /><br />The group&rsquo;s workload is falling as its customers scrimp in the downturn.<br /><br />But Jarvis said it did not expect the extended banking facility to hit liquidity. The company&rsquo;s cost of debt will go up by 0.35 per cent as part of the agreement.<br /><br />&ldquo;We are delighted to have been able to agree the extension of our working capital facility,&rdquo; Jarvis executive chairman Steven Norris said<br /><br />&ldquo;It is particularly pleasing to have reached this agreement despite the current difficult debt markets and we appreciate the continuing support of our bankers,&rdquo; he added.<br /><br />The company issued a profits warning earlier this year.