Last checked at 26 Jan 2022 07:01
NEWS RELEASE Issued on behalf of Flowtech Fluidpower plc Immediate Release Wednesday 26 January 2022 |
The information contained within this announcement is deemed by the Company to constitute inside information stipulated under the Market Abuse Regulation (EU) No. 596/2014 as amended by the Market Abuse (Amendment) (EU Exit) Regulations 2019. Upon the publication of this announcement via the Regulatory Information Service, this inside information is now considered to be in the public domain.
FLOWTECH FLUIDPOWER PLC
("Flowtech", the "Group" or "the Company")
Specialist full-service supplier of technical fluid power products and services
TRADING UPDATE AND NOTICE OF RESULTS
The Board of Flowtech issues the following unaudited Trading Update ahead of the Group's preliminary results for the year ended 31 December 2021.
2021 TRADING UPDATE
We expect to report Group revenue of c£109.0m, a 14.6% increase against the COVID-19 impacted 2020 comparative. We have included 2019 revenue in the table below to provide more meaningful comparisons. In summary our revenues are much improved in 2021 but have not yet reached pre pandemic levels.
Segment revenue: | FY 2021 Unaudited £'m | FY 2020 Audited* £'m | FY 2019 Audited* £'m | Change 2021 v 2020 | Change 2021 v 2019 | |
Flowtech | 52.1 | 46.1 | 52.2 | 13.2% | -0.1% | |
Fluidpower Group Solutions* | 39.6 | 33.6 | 44.1 | 17.9% | -10.4% | |
Fluidpower Group Services* | 17.3 | 15.4 | 16.1 | 11.9% | 7.5% | |
Total Group revenue for the period | 109.0 | 95.1 | 112.4 | 14.6% | -3.0% | |
Net debt** | 15.4 | 11.6 | 16.6 |
**Excludes IFRS16 related debt; FY2020 figure includes c.£0.9m of deferred VAT linked to Government COVID-19 related support schemes.
Overall, we expect our FY2021 underlying profit *** to be in line with the Board's expectations.
NET DEBT
Net debt** at 31 December 2021 was £15.4m, representing a £3.8m increase compared with £11.6m at 31 December 2020. The increase reflects the necessary investment we have made in our inventory position, designed to provide some protection against the significantly increased lead times that are now prevalent, as well as the recovery of our revenue streams and the associated increase in our trade receivables.
DEVELOPMENTS IN GROUP STRATEGY
In April 2021 we detailed the key elements of our growth strategy, and we have continued to make progress in key areas:
· Branding - As anticipated, the consolidation of the constituent parts of our Flowtech division was completed on 4 January 2022. This has involved significant cross functional time and effort that has enabled a platform for growth.
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· Digital - After some delays caused by a third party, our new E-Commerce platform will be launched in Q1. In the interim we have used current architecture to merge all online accounts into www.flowtech.co.uk. Once launched, the new platform will benefit from other aspects of our digital project and be a key component of our plans to deliver organic growth. |
OUTLOOK & DIVIDEND
Whilst demand throughout the fluid power market has continued to recover, it is clear that it will be well into 2022, if not longer, before global supply chains for fluid power product return to pre pandemic levels of both consistency and breadth of supply. Good progress against our strategic objectives continues to enhance the Group's medium term prospects. However, until supply is fully recovered, the Board is more cautious in the short term outlook.
Overall, the Board is satisfied with the trading performance in the year, is encouraged by the start to 2022, and pleased with the progress made against our key strategic objectives.
The Board expects to reintroduce a final dividend payment for the financial year 2021. Thereafter our dividend policy will recognise both the growth requirements of the business and the interests of our shareholders.
NOTICE OF RESULTS
The Company will update shareholders further at the time of the 2021 preliminary results announcement, scheduled to be released by the end of March 2022.
Roger McDowell, Non-Executive Chair commented:
"Whilst prioritising the wellbeing of our people the business has made solid progress against both our strategic goals and trading, notwithstanding supply chain challenges. Whilst there are still headwinds, we expect this momentum to continue in 2022 and remain confident for the future."
Notes
* Prior to 2021 Flowtech and Fluidpower Group Solutions figures were reported under one accounting segment, Components. The aggregate revenue shown in the table in this RNS equates to that reported under the heading of Components in the 20199 and 2002 annual report and accounts.
** Our reported Net debt figure does not take account of IFRS16 related debt which has reduced by c£0.25m in the year.
*** Underlying profit is profit before tax, asset impairment and separately disclosed items which comprise costs relating to amortisation, restructuring, acquisition and share based payments.
ENQUIRIES: |
Flowtech Fluidpower plc Bryce Brooks, Chief Executive Russell Cash, Chief Financial Officer Tel: +44 (0) 1695 52759 Email: info@flowtechfluidpower.com |
Liberum (Nominated adviser and Sole Broker) Richard Lindley / Ben Cryer / William Hall / Will King Tel: +44 (0) 20 3100 2000 |
TooleyStreet Communications (IR and media relations) Fiona Tooley Tel: +44 (0) 7785 703523 or email: fiona@tooleystreet.com |
About Flowtech Fluidpower plc Founded as Flowtech in 1983, the Flowtech Fluidpower Group is a group of specialist fluid power businesses. Working in partnership with customers and suppliers, we deliver essential components, customer solutions and high-quality servicing support to keep global industry moving. The business joined the AIM market in 2014. Since the start of 2021, the Group has been operating under three distinct branded segments: with Flowtech and Fluidpower Group Solutions forming what was 'Components', and Fluidpower Group Services the remainder. To read more about the Group please visit www.flowtechfluidpower.com.
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Segment: | What we do: | Locations: |
Flowtech
| Supply of both hydraulic and pneumatic consumables, predominantly through distribution for maintenance and repair operations across all industry markets and supported by supply agreements direct to a broad range of original equipment manufacturers.
Channels to market: E-commerce websites, customer white label e-commerce websites, catalogues, own and customer trade counters.
| Flowtechnology Benelux (Deventer) Flowtech - Skelmersdale, Leicester & Oldbury
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Fluidpower Group Solutions | Supply specialist technical hydraulic components & systems predominantly into OEMs and end-user channels to all industry markets and supported by supply agreements direct to a broad range of manufacturer brands.
Channels to market: Engineering collaboration, e-commerce. | Primary Fluid Power Components (Skelmersdale) Nelson Hi-Power Hydraulics (Dublin, Dungannon, UK) HTL (Ludlow) Hi-Power Hydraulics (Cork, Dublin, Belfast ) Hydroflex (Brussels, Rotterdam and OudBeijerland) Hydraulic Equipment Supermarkets (Gloucester, Leeds) Derek Lane & Co (Newton Abbot, Devon) HES Tractec (Gloucester)
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Fluidpower Group Services
| Bespoke design, manufacturing, commissioning, installation, and servicing of systems to manufacturers of specialised industrial and mobile hydraulic OEMs and additionally a wide range of industrial end users. Capital project-based revenue.
Channels to market: In-house design and build, combined with on-site installation, servicing and support.
| Primary Fluid Power Systems (Knowsley) Branch Hydraulic Systems and HES Automatec (Gloucester) HES Lubemec (Gloucester) HES Onsite (Leeds, Gloucester) Flow Connect (Gloucester) Orange County (Spennymoor)
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All the Group's divisions have overlapping product sets, allowing procurement synergies to be maximised. The above segments are supported by a centralised back-office team based in Wilmslow, Cheshire. In total, the business employs 618 people. For more information please visit, Our business | Flowtech Fluidpower plc | ||