Volvere Regulatory News (VLE)

1 March 2022

Volvere plc 

(the "Group" or "Volvere")

Trading Update and Notice of Final Results

Volvere plc (AIM: VLE), the growth and turnaround investment company, is pleased to provide the following trading update for the financial year ended 31 December 2021. All data in this announcement is unaudited, although the comparative information for the year ending 31 December 2020 has been extracted from audited data for that year.

The Group's trading operations include Shire Foods Limited ("Shire"), the Group's 80 per cent. owned frozen pastry products manufacturer, and Indulgence Patisserie Limited ("Indulgence"), which was acquired in February 2020 and manufactures frozen desserts.

Financial Performance

The Group expects to report revenue from continuing operations of approximately £35.58 million (2020: £30.81 million) and an overall profit before tax of £0.07 million (2020: loss before tax of £0.55 million).

Operating Businesses

Overview

Shire performed extremely well in the period, and Indulgence made steady, satisfactory progress. This was achieved despite both businesses facing significant headwinds including labour, raw material and energy cost increases, and with suppliers - both materials suppliers and logistics partners - being at times unable to meet our requirements. However, with the flexibility and commitment of both staff and customers, we have been able to mitigate the effects of these challenges.

Shire Foods

Shire continued to grow in 2021, with revenues increasing by approximately 12.6% to a new high of £30.61 million (2020: £27.19 million) and a solid profit before tax, intra-group interest and management charges* of approximately £2.14 million (2020: £1.81 million). Profit before tax was £1.89 million (2020: £1.61 million) - with the difference being intra-group interest and management charges. During 2021 Shire provided operational and commercial support to Indulgence and this has resulted in some costs being recharged which would otherwise have been borne by Shire.

Indulgence Patisserie Limited

Indulgence achieved revenue of £4.97 million, representing growth of approximately 21% compared with the prior period on an annualised basis (2020: period 7 February - 31 December 2020 £3.62 million). The loss before tax, intra-group interest and management charges* was approximately £1.01 million (2020: loss £1.02 million). The loss before tax was £1.08 million (2020: loss £1.02 million) - with the difference being intra-group interest and management charges.

During the year there was an increase in activity in the food service sector but, with many customers remaining affected by the pandemic restrictions, a return to normal trading was frustrated. However, the retail customer base grew substantially and we expect this will continue.

During the year, we have invested in new plant and machinery and we have strengthened the management team. We expect that the business's performance will improve this year as we launch new products.

The Group has continued to fund the initial purchase, working capital and trading losses by way of intra-Group loans.

Group Net Assets per Share and Net Assets

The Group expects to report year-end consolidated net assets per share (excluding non-controlling interests) of approximately £13.53 (31 December 2020: £13.65) and Group net assets of approximately £37.2 million (31 December 2020: £37.2 million).

Of the Group net assets, cash represented approximately £21.87 million (31 December 2020: £23.71 million).

The reduction in Group cash principally reflects the positive trading in Shire, offset by central costs, capital expenditure in new plant and the trading losses at Indulgence.

Current Trading

The challenges experienced in 2021 in relation to cost increases and labour availability continue in 2022 but we are working hard to protect margins and retain staff, whilst seeking growth opportunities in food manufacturing.

More generally, we believe the environment for turnaround investing is improving and we continue to review targets for acquisition or investment. The Group's high liquidity puts it in a strong position to capitalise on such opportunities.

As ever, what we have achieved in 2021 would not have been possible without the extraordinary efforts of our staff, amongst whom there are many heroes. We are grateful to all of them for their hard work and continuing commitment to our success.

* profit before intra-group interest and management charges is considered to be a relevant, useful interpretation of the trading results of the business such that its performance can be understood on a basis which is independent of its ownership by the Group.

Notice of Final Results

Volvere expects to announce its full year results for the year ended 31 December 2021 on or around 27 May 2022.

This announcement contains inside information for the purposes of the UK Market Abuse Regulation and the Directors of the Company are responsible for the release of this announcement.

For further information:

Volvere plc

Jonathan Lander, CEO Tel: +44 (0) 1926 335700

www.volvere.co.uk

Cairn Financial Advisers LLP (Nominated Adviser)

Sandy Jamieson/James Lewis Tel: + 44 (0) 207 213 0880

Canaccord Genuity Limited (Joint Broker) Tel: + 44 (0) 207 523 8000

Bobbie Hilliam/Alex Aylen/Georgina McCooke

Hobart Capital Markets LLP (Joint Broker)

Lee Richardson Tel: + 44 (0) 207 070 5691

Notes to editors:

Volvere plc (AIM: VLE), is a growth and turnaround investment company. The Group's current trading businesses are involved in food manufacturing. The Group currently employs approximately 260 people.

For further information, please visit www.volvere.co.uk.

Forward-looking statements:

This announcement may contain certain statements about the future outlook for Volvere plc. Although the directors believe their expectations are based on reasonable assumptions, any statements about future outlook may be influenced by factors that could cause actual outcomes and results to be materially different.