SFE.L Regulatory News (SFE)

18 July 2017

Safestyle UK plc

("The Group")

Half Year Trading Update

Safestyle UK plc (AIM: SFE), the leading retailer and manufacturer of PVCu replacement windows and doors to the UK homeowner market, today issues a trading update for the six months ended 30 June 2017, in advance of its half year results announcement scheduled for Thursday 21 September 2017.

Since our last trading statement at our AGM on 18 May 2017, the Company has continued to trade in line with earlier months, with order intake levels continuing up 2% year on year. Within this overall figure, however, the trend from week to week during Q2 has been more volatile than we have experienced for a long time. Furthermore, FENSA statistics for the five month period to the end of May 2017 show a market decline in volume terms in excess of 10%. Against this backdrop of patchier consumer demand, it is clear that Safestyle continues to significantly outperform the market and to increase share.

As outlined in our AGM statement, we expect to report marginal revenue growth in the first half of 2017, with reduced profits. Given the uncertain market conditions and weaker consumer confidence, we consider it prudent to expect only modest revenue growth again in the second half of the year. This would result in profits for the year being lower than previously anticipated and broadly in line with 2016. Cash flow has continued to be strong and we had net cash of £17.7 million at 30 June 2017 (30 June 2016: £23.6 million), the year on year reduction reflecting the investment in our new production facilities and the payment of a special dividend in July 2016.

Steve Birmingham, CEO of Safestyle UK, commented:

"Despite the difficult market conditions we have increased our order intake in the first half and significantly grown our market share. The company has a proven successful model that includes a comprehensive product range, attractive promotional finance and price competitiveness supported by financial strength.

In anticipation of a continuation of the recent weaker trading environment we have taken firm action to reduce our operating costs in the second half. Having successfully completed the investment in our enhanced production facility on time and on budget, we are well positioned to take advantage of the upturn in demand when it occurs."

Enquiries:

About Safestyle UK plc

The Group is the leading retailer and manufacturer of PVCu replacement windows and doors to the UK homeowner market. For more information please visit www.safestyleukplc.co.uk or www.safestyle-windows.co.uk