H1 2023 Trading Update

Luceco PLC

18 July 2023

 

18 July 2023                                                                                                                                                                                              

LUCECO PLC - H1 2023 TRADING UPDATE

Encouraging first half performance. Full year guidance towards the upper end of market expectations. Remain vigilant to the changing economic environment.

Luceco plc ("Luceco" or "the Group"), the supplier of wiring accessories, EV chargers, LED lighting, and portable power products, is pleased to provide the following update on trading for the six months ended 30 June 2023 ("H1 2023").

Highlights

Trading

·    The Group ended H1 2023 ahead of our expectations with revenue of c. £101M, c. 5.0% lower than H1 2022 and c. 5.7% lower on a like-for-like basis, as the current economic environment reduces residential RMI spending.

·    Gross margin percentage has continued to improve from the second half of 2022.

·    Adjusted Operating Profit is expected to be no less than £10.5m, ahead of our expectations.

·    Post-pandemic customer destocking appears to have ended.

Balance Sheet

·   Our covenant net debt ratio of 1.3x remains at the lower end of the target range of 1.0 - 2.0x EBITDA.

·   Working capital increased during H1 2023 as activity recovers following the impact of customer destocking at the end of 2022. We expect cash generation to improve in the second half.

·   The Group has significant available facilities to fund both organic investment and M&A.

Outlook

·    Trading in H1 2023 has been ahead of expectations, with non-residential project demand continuing its favourable trend, and the newly acquired businesses of SynvEV and D W Windsor both performing well.

·    Despite the less encouraging macro-economic indicators, current activity levels across the Group are healthy and supported by a strong Q3 order book.

·    Assuming demand continues at current levels and is not impacted by macro-economic headwinds, we anticipate that Adjusted Operating Profit for the full year will be towards the upper end of the range of current market expectations*.

Commenting on the results, Chief Executive Officer, John Hornby said:

"It is encouraging to again see our gross profit margin improving and reassuring that our order book supports a good outlook for Q3. Material and freight cost pressures continue to ease on the whole, but wage pressures remain. We are excited by a number of product developments which provide us with good medium and long-term opportunities for growth, particularly within the EV business.  We continue to build an attractive M&A pipeline.  Historically the Group has enjoyed a stronger second half and, whilst we are mindful of the current economic environment, we expect a similar profile again this year."

*consensus at the 17^th July 2023, full year 2023 Adjusted Operating Profit £20.3m (Analyst Range £19.2 - 21.9m)

Luceco plc	Contact
John Hornby, Chief Executive Officer	020 3128 8276 (Via MHP)
Will Hoy, Chief Financial Officer	020 3128 8276 (Via MHP)
MHP	Contact
Tim Rowntree	020 3128 8004
Ollie Hoare	020 3128 8276

This announcement is released by Luceco plc and contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 (MAR). It is disclosed in accordance with the Company's obligations under Article 17 of MAR. Upon the publication of this announcement, this information is considered to be in the public domain.

For the purposes of MAR and Article 2 of Commission Implementing Regulation (EU) 2016/1055, this announcement is being made on behalf of Luceco plc by Will Hoy, Chief Financial Officer.

Note to Editors

Luceco plc - Bringing Power To Life

Luceco plc (LSE:LUCE) is a supplier of wiring accessories, EV chargers, LED lighting, and portable power products.

For more information, please visit www.lucecoplc.com.

Forward-looking statements

This announcement contains forward‑looking statements that are subject to risk factors associated with, among other things, the economic and business circumstances occurring from time to time in the countries, sectors and markets in which the Group operates. It is believed that the expectations reflected in these statements are reasonable, but they may be affected by a wide range of variables which could cause actual results to differ materially from those currently anticipated. No assurances can be given that the forward‑looking statements in this announcement will be realised.

The forward‑looking statements reflect the knowledge and information available at the date of preparation of this announcement and the Company undertakes no obligation to update these forward‑looking statements. Nothing in this announcement should be construed as a profit forecast.

 

END