TIDMVCT
RNS Number : 1185F
Victrex PLC
06 July 2023
6 July 2023
Victrex plc - Q3 Interim Management Statement
Volumes lower on macro-economic weakness; further price
improvement
Victrex plc is an innovative world leader in high performance
polymer solutions, delivering sustainable products which support
CO2 reduction and bring environmental and societal benefit in
multiple end-markets. Today's Interim Management Statement for Q3
covers the period 1 April 2023 to 30 June 2023.
Performance summary - Q3 in line with guidance
As previously communicated in our trading update of 14 June 2023
and at our interim results, compared to a record prior year period,
the Group is seeing ongoing macro-economic weakness and destocking
across several end markets.
The Group continues to be well positioned for a macro-economic
recovery.
Q3 saw further improvement in average selling prices (ASP),
taking year-to-date ASP to GBP85/kg, supported by price increases,
sales mix and currency. We now anticipate that full year ASP will
be above GBP84/kg. This in turn, together with easing energy costs,
means we are seeing gross margin improvement during the second
half, compared to the prior year, but it will be slightly held back
by lower asset utilisation.
Further progress in mega-programmes; E-mobility exceeding
expectations
Further progress was seen in commercial milestones within our
'mega-programme' growth pipeline, particularly in E-mobility and
Trauma. We now anticipate annual revenues in our E-mobility
mega-programme will exceed our original expectations, reaching
GBP5m in FY 2023. In Trauma, we are making good progress with our
PEEK composite Trauma plates, serving growing demand in the US and
Asia. Run-rates are building towards GBP1m revenue and further
growth in both E-mobility and Trauma is expected in FY 2024.
Q3 performance:
-- Q3 Group revenue down 23% to GBP72.2m (Q3 2022: GBP93.4m)
-- Q3 Group volume down 38% to 818 tonnes (Q3 2022: 1,323 tonnes)
-- Year to date Group revenue of GBP234.4m is 8% down on the
prior year (2022 YTD: GBP253.5m), with YTD Group volume of 2,759
tonnes being 23% down on the prior year (2022 YTD: 3,586
tonnes)
-- Q3 weakness driven by Electronics, Energy & Industrial and Value Added Resellers
-- Aerospace seeing good growth; Automotive stable YTD
-- Medical performing strongly; YTD revenue continues to track up double-digit
Financial position
Victrex retains a highly cash generative business model, which
supports growth investment and shareholder returns. Capital
expenditure this year is focused on our China manufacturing
investments, with our new PEEK polymer facility having delivered
first polymer ahead of commercial start up by the end of 2023.
Total cash on 30 June 2023 was GBP27m, which includes GBP3.5m cash
ringfenced in China investments. Capital expenditure will start to
step down from FY 2024, supporting improving cashflows.
Outlook unchanged
Jakob Sigurdsson, Chief Executive of Victrex, said: "In line
with our recent trading update, we continue to be impacted by
ongoing macro-economic weakness and destocking in several end
markets. Compared to a record prior year period, lower Q3 volumes
were driven by Electronics, Energy & Industrial and Value Added
Resellers. Aerospace and Medical continue to perform strongly,
whilst Automotive is stable year-to-date.
"Overall, our Outlook is unchanged from what we recently
communicated, with full-year adjusted (pre-exceptional) PBT
expected to be in the range of GBP80m-GBP85m. As we move into the
final quarter, strong average selling prices, mix, energy costs and
cost discipline remain supportive, and we continue to be
well-placed for when the macro-economic environment improves.
"On a medium to long term basis, we have a strong and diverse
core business, growing commercialisation in our mega-programmes,
capital investment which is set to reduce and support improving
cash flows, and strong ESG credentials."
Victrex will report its Preliminary Results for 2023 on Tuesday
4 December 2023.
Analyst & investor call:
A call for analysts & investors will be held today, Thursday
6 July, at 08.30am UK time. To register for the call please follow
this link:
https://services.choruscall.za.com/DiamondPassRegistration/register?confirmationNumber=3197336&linkSecurityString=82f3181b0
Enquiries:
Victrex plc:
Andrew Hanson, Director of Investor Relations, Corporate +44 (0) 7809
Communications & ESG 595831
+44 (0) 1253
Jakob Sigurdsson, Chief Executive 897700
+44 (0) 1253
Ian Melling, Chief Financial Officer 897700
About Victrex:
Victrex is an innovative world leader in high performance
polymer solutions, focused on the strategic markets of Automotive,
Aerospace, Energy & Industrial, Electronics and Medical. Every
day, millions of people rely on products or applications which
contain our sustainable materials, from smartphones, aeroplanes and
cars to oil & gas operations and medical devices. With over 40
years' experience, we are moving beyond the polymer into
semi-finished and finished products which shape future performance
for our customers and our markets, provide environmental and
societal benefit for customers and drive value for our
shareholders. Find out more at www.victrexplc.com
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END
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July 06, 2023 02:00 ET (06:00 GMT)
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