Last checked at 11 Jan 2022 07:00
11 January 2022
FRANCHISE BRANDS PLC
("Franchise Brands", "the Group" or "the Company")
Year End Trading Update and Notice of Results
Group continues strong trajectory in 2021 as Metro Rod breaks through £50m of system sales
The Board of Franchise Brands plc (AIM: FRAN), a multi-brand franchise business, is pleased to provide the following trading update for the financial year ended 31 December 2021.
During Q4 2021 the Group continued the strong trajectory that has characterised the whole of 2021. The performance was underpinned by the strong growth at Metro Rod where system sales for the quarter grew by 22% year-on-year to a record of £13.7m. This final quarter performance has meant that full year Metro Rod system sales grew by 24% to a record £50.4m (2020: £40.6m).
Willow Pumps' service division continues to grow and contributed to the overall business growing sales for the year by 11% to £13.8m (unaudited) (2020: £12.4m). However, the supply and install division has been slower to recover.
The Group's B2C division continues to perform robustly with 57 new recruits year-to-date (2020: 58), strong cash generation and continued tight cost control.
The acquisition of Azura Group, a leading franchise management software system developer, in November represents an important step in the Group's digital journey. It gives us ownership of our core systems, which are highly scalable, and the ability to further customise them to meet the needs of the business, our franchisees and our customers. It also provides the Group with an exciting new growth opportunity.
The strong cash generative nature of the Group's business has allowed the early full repayment of its term loan. At the year end, the Group had cash of £9.0m and an additional £5m of unutilised debt facilities. The strength of the deleveraged balance sheet and high level of liquidity puts the Group in a strong position to support its franchisees, invest in the business, support a progressive dividend policy, and take advantage of earnings-enhancing acquisition opportunities.
The final results for the year ended 31 December 2021 are expected to be announced on 3 March 2022 and the Board looks forward to updating shareholders with further details at that time.
Stephen Hemsley, Executive Chairman of Franchise Brands, commented:
"I am very pleased by the 2021 performance of the Metro Rod business. To break through £50m of system sales is a fantastic achievement and a testament to the hard work of our franchisees, our engineers, and the team at the Metro Rod support centre in Macclesfield led by Peter Molloy.
"Although the COVID pandemic continues to impact certain parts of our business, the performance of the Group in 2021 demonstrates the strength of our growth strategy and the dedication and commitment of our people. The ability of the Group to meet and overcome these challenges means that I look forward to 2022 and beyond with great optimism."
Enquiries:
Franchise Brands plc | + 44 (0) 1625 813231 |
Stephen Hemsley, Executive Chairman | |
Chris Dent, Chief Financial Officer | |
Julia Choudhury, Corporate Development Director | |
Allenby Capital Limited (Nominated Adviser and Joint Broker) | +44 (0) 20 3328 5656 |
Jeremy Porter / Liz Kirchner (Corporate Finance) Amrit Nahal (Sales and Corporate Broking) | |
Dowgate Capital Limited (Joint Broker) | +44 (0) 20 3903 7715 |
James Serjeant / Russell Cook / Nicholas Chambers | |
MHP Communications (Financial PR) | +44 (0) 20 3128 8100 |
Katie Hunt | +44 (0) 7884 494112 |
franchisebrands@mhpc.com |
About Franchise Brands plc
Franchise Brands is focused on building market-leading businesses in selected customer segments using primarily a franchise model. The Group currently has a combined network of over 425 franchisees across five principal franchise brands. Our focus is on established brands which can benefit from our shared support services, specialist sector expertise, management experience and group resources.
The Group is organised into a B2B division comprised of Metro Rod, Metro Plumb, and Willow Pumps, and a B2C division that incorporates ChipsAway, Ovenclean and Barking Mad. This divisional organisation of our brands is designed to provide a greater focus and structure to support the strategic development of our B2B and B2C brands.
Each of our brands are leaders in their respective markets and each brand has a long trading history. The combined trading history of all the Group's brands is over 165 years.
Franchise Brands plc employs some 300 people across three principal locations in Macclesfield, Kidderminster and Aylesford.
For further information, visit www.franchisebrands.co.uk.