Interim Management Statement

RNS Number : 3512O

Avon Rubber PLC

06 August 2014

 

Strictly embargoed until 07:00 Wednesday 6 August 2014

AVON RUBBER p.l.c. ("Avon", the "Group" or the "Company")

Interim Management Statement for the period 1 April 2014 to 5 August 2014

Introduction

Avon is pleased to report that trading has continued to be strong since the end of the first half of our financial year. The Board remains confident that the outturn for the full year, after the impact of an estimated £1.0m currency headwind, will be in line with market expectations.

Protection & Defence

The Protection & Defence business has experienced another buoyant period. Further orders worth £25m from the DoD since the half year secure expected sales to this customer for the current financial year and provide a healthy opening order book for next year. We have also seen an increased level of non-DoD orders from customers in the Americas, in particular in the fire services market for our newly approved Deltair SCBA.

We are pleased to announce that we are the first supplier to receive approval for our closed circuit escape breathing device (EEBD) under the new NIOSH standard. This approval is an essential requirement under a solicitation by the US Navy which we expect to respond to later this calendar year.

Dairy

Market conditions for our Dairy business remain favourable and the investments made in 2013 are now delivering the benefits we expected. In particular our cluster exchange service offering continues to gain momentum in both North America and Europe and we have seen positive third quarter trading in our Chinese business after a slow first half of the year.

Foreign exchange translation sensitivity

The Group has a number of US operations and the translation of US$ profits into sterling on consolidation exposes us to foreign exchange translation differences. The average rate of exchange in 2013 was $1.56 / £1. If the current rate of $1.69 / £1 prevails for the remainder of our financial year, the average rate for 2014 is estimated to be $1.67 / £1, and would give rise to a negative currency translation variance compared with 2013 of £1.0m at a profit before tax level.  

Lawrenceville facility relocation

The relocation of operations from our Lawrenceville facility to our Cadillac facility has progressed to plan. The first shipments of our new Deltair product have been made from Cadillac.

Net debt

The Group has seen strong conversion of profits into cash and net debt at 30 June 2014 was £2.6m, which compares to £10.9m at 30 September 2013 and £5.5m at 31 March 2014. During the period the Group successfully negotiated a new and increased $40m revolving credit facility with its bankers which runs to 30 November 2017.

Year-end announcement

The Group will announce its results for the year to 30 September 2014 on Wednesday 19 November 2014.

For further enquiries, please contact:

Avon Rubber p.l.c.
Peter Slabbert, Chief Executive	01225 896831
Andrew Lewis, Group Finance Director	01225 896830
Sarah Matthews-DeMers, Group Financial Controller	01225 896835
Sophie Williams, Group Public Relations Manager	01225 896563
Weber Shandwick Financial
Nick Oborne	020 7067 0700

Note to editors: The Group has transformed itself over the past five years into an innovative design and engineering group specialising in two core markets, Protection & Defence and Dairy. With a strong emphasis on research and development we design, test and manufacture specialist products from a number of sites in the US and UK, serving markets around the world. We achieve this through nurturing the talent and aspirations of our employees to realise their highest potential.

Avon Protection is the recognised global market leader in advanced Chemical, Biological, Radiological and Nuclear (CBRN) respiratory protection systems technology for the world's military, homeland security, first responder, fire and industrial markets. With an unrivalled pedigree in mask design dating back to the 1920's, Avon Protection's advanced products are the first choice for Personal Protective Equipment (PPE) users worldwide and are placed at the heart of many international defence and tactical PPE deployment strategies. Our expanding global customer base now includes military forces, civil and first line defence troops, emergency service teams and industrial, marine, mineral and oil extraction site personnel. All put their trust in Avon's advanced respiratory solutions to shield them from every possible threat.

Our world-leading Dairy business and its Milkrite brand have a global market presence. With a long history of manufacturing liners and tubing for the dairy industry, Milkrite has become the leading innovator and designer for products and services right at the heart of milking. Our goal is always to improve and maintain animal health. Working with the leading scientists and health specialists in the global dairy industry we continue to invest in technology to further improve the milking process and animal welfare. Our products provide exceptional results for both the animal and the milker, making the milk extraction process run smoothly. As our market share and milking experience continue to grow, so does our global presence.

For further information please visit the Group's website www.avon-rubber.com

 

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