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(Sharecast News) - Specialist fluid power product and service supplier Flowtech Fluidpower reported 2022 revenue of £114.8m in its preliminary results on Wednesday, which was up 5.2% year-on-year.
The AIM-traded firm said its underlying operating profit improved £2.9m to £8.6m, while its underlying EBITDA increased £3.2m to £11.6m.
It said that during the year, it implemented measures to manage its cost base, including a significant reduction in staff numbers by the end of the year.
That, the board said, led to a reduction of underlying operating overheads by £0.4m, or 1.3%, despite significant inflationary pressures.
Flowtech said its services segment performed significantly better in 2022, with an underlying operating profit of £1.8m compared to a loss of £0.1m in 2021.
The company also managed inventory levels to mitigate the impact of supply chain uncertainties and satisfy customer demand for core products, resulting in an increase of £1.0m in 2022.
However, inventory levels were now reducing, with a decrease of £3.2m in the second half due to more predictable supply chains.
Flowtech Fluidpower disclosed separate items of £13m, including a goodwill impairment of £10.1m, restructuring costs of £1.4m relating to the exit from the Leicester Logistics Centre, and £0.9m of amortisation of intangibles.
After taking the items into account, the firm reported a loss before tax of £5.6m.
"2022 saw the completion of many of the key changes that we defined in our 2020 strategy review and in 2023 we will continue to pursue all remaining elements with vigour," said chief executive officer Bryce Brooks.
"With supply chains now more predictable, and at both sector and geographical level demand remaining broadly stable, we are confident that all the major strategy decisions we have made will create additional shareholder value, and will quickly feed through into strong cash generation available for further investment to drive shareholder value."
Looking forward to 2023, Flowtech Fluidpower said it expected to continue its recovery from the Covid-19 pandemic, and focus on inventory management, debt reduction, and cash generation to achieve further improvements.
"We have entered 2023 with much of the strategic building blocks in place after an array of challenges over the past three years, and we will remain focused on completing the remaining actions of our strategic plan," added non-executive chair Roger McDowell.
"With global supply chains now more consistent, we can reduce inventories to match our needs and return to generating strong cash flows to support our investment activities, whilst exploiting our new digital capabilities."
At 1418 BST, shares in Flowtech Fluidpower were down 5.39% at 104.54p.
Reporting by Josh White for Sharecast.com.
