Last checked at 6 Sep 2022 07:00
6 September 2022
Renold plc
("Renold", the "Company" or the "Group")
AGM Trading Update
Renold, a leading international supplier of industrial chains and related power transmission products, is pleased to provide a trading update covering the five months ended 31 August 2022 (the "Period") ahead of the Company's Annual General Meeting ("AGM") being held at 11 am today.
The Board is pleased to report that the strong momentum experienced in the second half of the last financial year has continued into the new financial year. Following the acquisition of Industrias YUK S.A. ("YUK"), announced on 4 August 2022, full year expectations were increased to reflect the immediate earnings enhancement expected.
Sales revenue for the Period, at £93.0m, represents an increase of 18.7% on the prior year equivalent period or an increase of 11.7% at constant exchange rates. Post-acquisition, YUK contributed £0.8m to sales during the Period.
Order intake for the Period was £97.9m. Excluding the impact of the £11.0m long term military contract announced in July 2021, this represents an increase of 15.3% over the prior year equivalentperiod or 7.6% at constant exchange rates. YUK contributed £0.8m to order intake.
Order books as at 31 August 2022 of £97.3m again represent a record high for the Group. YUK contributed £3.9m to the order book.
As a consequence of the acquisition of YUK for initial cash consideration of €20.0m and increased inventory holdings, as part of contingency planning against the potential impact of energy supply disruption in the second half of the financial year, net debt at half year is projected to be approximately 1.5 times EBITDA, in line with previous guidance.
Whilst the Board is mindful that global markets continue to be uncertain, with ongoing labour and energy cost inflation and supply chain disruption, the Group's trading momentum continues to be positive. The Group has record order books and the acquisition of YUK provides opportunities for synergies and further growth. Therefore, the Board expects adjusted operating profit for the year to 31 March 2023 to be in line with recently increased market expectations, following the announcement of the acquisition of YUK on 4 August 2022.
ENQUIRIES:
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Renold plc | IFC Advisory Limited |
Robert Purcell, Chief Executive | Tim Metcalfe |
Jim Haughey, Group Finance Director | Graham Herring |
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0161 498 4500 | 020 3934 6630 |
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Nominated Adviser and Joint Broker
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Peel Hunt LLP | FinnCap Limited |
Mike Bell | Ed Frisby / Tim Harper (Corporate Finance) |
Ed Allsopp | Andrew Burdis / Harriet Ward (ECM) |
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020 7418 8900 | 020 7220 0500 |
NOTES FOR EDITORS
Renold is a global leader in the manufacture of industrial chains and also manufactures a range of torque transmission products which are sold throughout the world to a broad range of original equipment manufacturers and distributors. The Company has a well-deserved reputation for quality that is recognised worldwide. Its products are used in a wide variety of industries including manufacturing, transportation, energy, steel and mining.
Further information about Renold can be found on the website at: www.renold.com