Volution Group PLS Regulatory News (FAN)

Embargoed to 07:00

Friday 11th December 2020

Volution Group plc

AGM Trading Update for 4 months to 30 November 2020

Earnings significantly ahead of expectations and 20% operating margin target achieved early

Volution Group plc ("Volution" or "the Group" or "the Company", LSE: FAN), a leading international designer and manufacturer of energy efficient indoor air quality solutions, today announces an update on trading covering the four months to 30th November 2020.

Trading update

We continue to prioritise the safety and security of our employees, suppliers and customers, maintaining a full service of our essential products and services. All of our facilities are operating fully compliant with local Covid-19 guidelines and whilst there are a number of employees working remotely from their normal place of work, we continue to provide good levels of customer service and responsiveness to the strong demand we are experiencing in all of our markets.

Group revenues were £90.7m in the first four months of the financial year, an organic growth of 6.8% (at constant currency ("cc")). Group activity has performed consistently well in each of the four months and this level of activity coupled with the operational excellence and streamlining initiatives has enabled the Group to achieve its adjusted operating margin target of 20% a full eight months earlier than expected. The margin expansion is broad based and sustainable, with all three of our geographic areas contributing to a significant improvement over the prior year.

In the UK organic growth for the first four months was 3.1% (cc), with residential refurbishment delivering an organic growth of 10.4%. Public residential refurbishment was up 6.6% on the prior year supported by our innovative product portfolio. Our significant market share, broad residential product portfolio and launches of a number of premium ranges have enabled us to deliver very strong organic growth in this area. Residential new build systems revenue declined 6%, however sales have steadily progressed since the start of our new financial year with the order intake in the same period being in-line with the prior year. In commercial we have seen revenue decline by 1.2%, however, the order intake is significantly ahead of the prior period. Our OEM business revenue increased by 9.4% (cc) on the prior year with good take up from new accounts for our energy efficient EC3 motorised impeller.

Continental Europe has delivered an organic growth of 7.9% (cc) in the first four months of the new financial year. The Nordics has delivered growth of 12.9% (cc) with our market leading residential refurbishment ranges in Sweden being the strongest performer. Over the last year we have continued to introduce new products into our existing channels and this coupled with a stronger order book for new projects has delivered a strong organic growth. In Central Europe our organic growth is 1.6% (cc), building on a full year growth in FY20 of 7.5% (cc).

Australasia has delivered the strongest organic growth across our three geographic regions of 18% (cc). In New Zealand we continue to benefit from the "Healthy Homes Standards" and in Australia, since acquiring Ventair in March 2019, we have made significant headway with market share gains, again utilising the Group's enriched product portfolio and new product launches to win new accounts.

On 2nd December we completed a sustainability linked £150m revolving credit facility, further underpinning and supporting our ability to execute our strategy.

Summary

The Board is very pleased with the start to the new financial year with strong organic growth and considerable operating margin expansion, and as a result, earnings are significantly ahead of expectations. The Covid-19 pandemic continues to impact on our markets and in the UK the ongoing negotiations to finalise an acceptable trade agreement with the EU are a concern. However, we believe that the increasing awareness of how indoor air quality impacts on health, the heightened awareness from local governments in all of our geographies on the need to tackle carbon emissions and energy consumption, underpinned by our leading brands, allows us to benefit from these trends and leaves us well positioned to make further good progress in the months and years ahead.

Ronnie George, Chief Executive Officer, commented:

"We are delighted with current trading, the strong organic growth in the first four months of the year and delivering a 20% operating margin earlier than expected. The organic growth of 6.8% is a credit to our local leadership teams and the incredible commitment of our loyal and dedicated employees as we operate our adapted business model in the face of the ongoing global pandemic."

-Ends-

For further information: 

Volution Group plc Legal Entity Identifier: 213800EPT84EQCDHO768.

Note to Editors:

Volution Group plc (LSE: FAN) is a leading international designer and manufacturer of energy efficient indoor air quality solutions. Volution Group comprises 16 key brands across three regions:

UK: Vent-Axia, Manrose, Diffusion, National Ventilation, Airtech, Breathing Buildings, Torin-Sifan.

Continental Europe: Fresh, PAX, VoltAir, Kair, Air Connection, inVENTer, Ventilair.

Australasia: Simx, Ventair.

For more information, please go to: www.volutiongroupplc.com

 Cautionary statement regarding forward-looking statements

This document may contain forward-looking statements which are made in good faith and are based on current expectations or beliefs, as well as assumptions about future events. You can sometimes, but not always, identify these statements by the use of a date in the future or such words as "will", "anticipate", "estimate", "expect", "project", "intend", "plan", "should", "may", "assume" and other similar words. By their nature, forward-looking statements are inherently predictive and speculative and involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. You should not place undue reliance on these forward-looking statements, which are not a guarantee of future performance and are subject to factors that could cause our actual results to differ materially from those expressed or implied by these statements. The Company undertakes no obligation to update any forward-looking statements contained in this document, whether as a result of new information, future events or otherwise.