Last checked at 20 Oct 2022 07:00
Trifast plc
(Trifast, Group or Company)
leading international specialist in the design, engineering, manufacture, and distribution
of high-quality industrial fastenings and Category 'C' components principally to major global assembly industries
Trading Update
&
Notice of Half-yearly results
London, Thursday, 20 October 2022: The Board of Trifast issues the following unaudited update covering the Group's financial half year period ended 30 September 2022, ahead of the publication of its 2023 Half-year results.
Key points in HY1:
Ø Group revenue ahead of comparable period c.£120m (H1FY22: £103.7m AER) |
Ø Continued mixed demand backdrop across our key end market sectors and international footprint Ø Additional contract wins in the period totalling £12m, reflecting market share gains and commercial focus on faster growing niches Ø Underlying operating profit impacted by inflationary pressures and pricing recovery lag |
Ø Stocks increased in short-term ensuring ongoing continuity of supply for new and existing business |
Ø General activity levels and opportunities provide confidence for the medium-term |
Overview
The first half of the 2023 financial year has proved to be one of challenge and opportunity against the global uncertainties surrounding industrial markets. As a Group, we have continued to experience a mixed demand picture across our diversified end market and geographic footprint. Whilst our operations in Asia and US have produced a solid performance and slightly ahead of expectations, we have experienced, as a result of weakened consumer demand, a slowdown in particular within the Health & home sector in the UK and Europe. Volumes have improved across our other key markets with Light vehicle and General industrial showing the strongest growth over the same period last year, followed by the Distributors and Energy, tech & infrastructure sectors.
We are focussing on both cost management and pricing actions to mitigate the impact of ongoing, significant, inflationary cost increases. This includes ongoing pricing negotiations with a number of our key OEM customers. In a number of cases, these negotiations are taking an extended period to conclude and so this activity will continue into the second half and consequently we will not see a significant contribution from these until later in the financial year.
We continue to make good progress on our strategic growth initiatives through a mix of customer service, technical innovation, investment and capturing key commercial opportunities. New contract wins secured in the last financial period are beginning to feed through and, in addition, we have secured during H1FY23 a further £12m of contractual wins across our key sectors with the largest uplift being in Light vehicle, all of which is very encouraging.
Given the commodity and supply chain challenges we have all faced in the last few years, Group inventory levels have been held above pre-pandemic levels. Inventory value has increased during the first half, reflecting a mix of foreign exchange, commodity price increases, and the need not only to ensure ongoing continuity of supply to our key global OEM customers, but also the ability to service new contracts secured in the latter part of the last financial year and the new wins mentioned above which have been and are coming on stream over the course of the next few months. Although inventories remain above historic levels, we are working hard to reduce these over the second half of the year.
Business outlook summary
With inflationary costs remaining elevated as a result of external factors highlighted, we are focussed on initiative-taking steps to mitigate the impact of these on our margins and profitability through a mix of operational efficiencies and profit enhancements.
As set out at the time of our FY2022 results, we continue to believe that the Group's FY2023 profitability will be weighted towards the second half of the year. Reflecting the continued commercial momentum the Board currently expects FY2023 Group revenue to be slightly ahead of its previous expectations. However, given the short-term headwinds from the ongoing inflationary pressures as well as some tactical growth investment, the Board currently expect that the Group's underlying profitability for the year ending 31 March 2023 will be around 10% below current market consensus.*
As a Group, we continue to see significant scope to build the business and we remain confident in the fundamentals of our business model over the medium term once we see market confidence return for a sustained global economic recovery.
Notice of Half-year results and presentations
The Group is scheduled to release its 2023 Half year report on Tuesday, 22 November 2022 at 07.00 hrs via the Regulatory News Service, and there will be an analyst conference online at 9.15am GMT.
The Company will also hold a presentation via the Investor Meet Company platform (IMC) on Thursday, 24 November 2022 at 11.30am GMT. Investors who follow Trifast on the IMC platform will automatically be invited to join the session. To register for the session, you may follow this link:
https://www.investormeetcompany.com/trifast-plc/register-investor
Both sessions will be hosted by CEO Mark Belton, and Interim CFO Andrew Cooksey and a recording of the presentation will be available on the Company's website to view and download.
* Prior to this announcement Bloomberg-compiled consensus expectations for adjusted profit before income tax and separately disclosed items, for the year ending 31 March 2023 is £16.3m.
Further enquiries please contact: |
Trifast plc |
Jonathan Shearman, Chair |
Mark Belton, Chief Executive Officer |
Christopher Morgan, Company Secretary |
Tel: +44 (0) 1825 747630 |
Email: corporate.enquiries@trifast.com |
Shareholders: Companysecretariat@trifast.com |
Peel Hunt LLP (Stockbroker & financial adviser) |
Mike Bell |
Tel: +44 (0) 20 7418 8900 |
TooleyStreet Communications, (IR & media relations) |
Fiona Tooley |
Tel: +44 (0)7785 703523 or Email:fiona@tooleystreet.com |
Editors' notes |
About Trifast plc
"Innovation today for a better tomorrow - Growing sustainably, together" Trifast (TR) is a leading international specialist in the design, engineering, manufacture, and distribution of high-quality industrial fastenings and Category 'C' components principally to major global assembly industries. We supply to c. 5,000 customers in c.75 countries across a wide range of industries, including Light vehicle, Heavy vehicle, Health & Home, Energy, Tech and Infrastructure (ET&I), General industrial and Distributors. As a full-service provider to multinational OEMs and Tier 1 companies spanning several sectors, TR delivers comprehensive support to its customers from concept design through to technical engineering consultancy, manufacturing, supply management and global logistics. The Group employs c.1,300 people across 34 business locations within the UK, Asia, Europe, and the USA including seven high-volume, high-quality, and cost-effective manufacturing sites and three technical & innovation centres across the world.
For more information, visit: TRIFAST PLC TRI Stock | London Stock Exchange Our website: www.trifast.com LinkedIn: www.linkedin.com/company/tr-fastenings Twitter: www.twitter.com/trfastenings Facebook: www.facebook.com/trfastenings
Note Trifast, TR and TR Fastenings are registered trademarks of the Company. LEI number: 213800WFIVE6RUK3CR22
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This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR. Upon the publication of this announcement via the Regulatory Information Service, this inside information is now considered to be in the public domain.