TIDMLUCE
RNS Number : 3808M
Luceco PLC
21 January 2021
21 January 2021
Luceco plc
Full Year 2020 Trading Update
Notice of Results
Luceco plc ('the Group' or 'Luceco'), the manufacturer and
distributor of wiring accessories, LED lighting and portable power
products, is pleased to provide the following trading update for
the fourth quarter ('Q4 2020') and the year ended 31 December 2020
('FY 2020').
The Group traded strongly in Q4 2020 and we expect to report
record full year profits at the top end of the most recently guided
range.
Construction activity was relatively unencumbered by lockdown
measures in most of our markets. Demand for our products remained
high as consumers spent more of their time and money at home. Our
higher share of e-commerce and multi-channel capable customers
provided a continued route to market when traditional distribution
channels temporarily closed to combat COVID. Demand in traditional
channels recovered relatively quickly as lockdown controls eased as
the year progressed.
As a result of the strong trading performance in the second half
of the year, we have taken the decision to repay in full furlough
support of GBP1.0m received from the UK Government.
Our manufacturing operations remain fully operational and COVID
is currently not disrupting our sales channels or distribution
operations.
Q4 2020 performance
-- Revenue growth of 23.0%, at the top end of previous expectations:
o Exceptional recovery in the UK wholesale channel in H2 2020
following the reopening of customer branches
o Continued strong demand from online and multi-channel
customers and DIY markets, supported by new business wins
o Production and sea freight capacity unable to fully meet
exceptional demand
o Carrying good momentum into FY 2021
-- Gross margin was higher than H1 2020 due to manufacturing
efficiency gains and a greater proportion of higher margin
professional sales; however, lower than forecast due to
unexpectedly high raw material cost inflation.
-- Adjusted Operating Profit more than doubled from the
comparative period last year driven by strong revenue growth and
tight control of overheads.
FY 2020 performance
-- Revenue of approximately GBP176m (FY 2019: GBP172.1m):
o Revenue growth of 2.3%
o Ground lost to COVID in H1 2020 more than compensated by
strong performance in H2 2020
o Outperformed the UK market
-- Adjusted Operating Profit of approximately GBP30m (FY 2019:
GBP18.0m), primarily driven by significant margin improvement:
o Gross margin increased to approximately 40%, despite raw
material cost pressures in H2 2020
o Overheads diligently controlled, with many COVID-driven
reductions in H1 2020 retained in H2 2020
o Reflects full repayment of GBP1.0m of UK Government furlough
support
o Adjusted Operating Margin of approximately 17% (FY 2019:
10.5%)
-- Continued strong cash conversion, leverage reduction and reinstatement of dividend:
o Adjusted Free Cash Flow of approximately GBP22m (FY 2019:
GBP18.9m)
o Closing net debt of GBP18.3m, equal to approximately 0.5x
Adjusted LTM EBITDA (FY 2019: 1.1x)
o Significant balance sheet capacity for future investment in
growth
o Dividends reinstated and payout range increased, as previously
announced
Notice of Results
The Group's final results for the year ended 31 December 2020
will be released on Tuesday 23 March 2021. There will be a webcast
of the results at 9:30am on 23 March 2021 for analysts and
investors. Please email luceco@mhpc.com to register for the
webcast.
John Hornby, Chief Executive Officer, said:
"I am very pleased to report that we ended the year as strongly
as expected, with record full year profits against the backdrop of
COVID.
We have started the new year with good momentum despite tighter
social distancing measures. Increased home improvement spending is
likely to continue and new business wins, superior channel access
and product availability should sustain further market share gains.
Whilst we are now entering a more challenging inflationary
environment, we aim to defend the significant margin gains we have
made. Unless future lockdown measures severely disrupt our sales
channels or distribution operations, we are confident of further
revenue and profit progression in 2021."
- ENDS-
For further information, please contact:
Luceco plc Contact
============================= ======================================
John Hornby, Chief Executive 020 3128 8572 (Via MHP Communications)
Officer
Matt Webb, Chief Financial 020 3128 8572 (Via MHP Communications)
Officer
MHP Communications Contact
============================= ======================================
Tim Rowntree 020 3128 8572
James Bavister 020 3128 8572
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 Group'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 Matt Webb, Chief Financial Officer.
Business summary
Luceco is a manufacturer and distributor of high quality and
innovative wiring accessories, LED lighting and portable power
products for a global customer base.
The Group supplies trade distributors, retailers, wholesalers
and project developers with a wide range of products which broadly
fall into the following market recognised brands:
-- British General ("BG"): wiring accessories including switches
and sockets, circuit protection and cable management products;
-- Luceco and Kingfisher Lighting: energy efficient LED lighting
products and associated accessories;
-- Masterplug: cable reels, extension leads, surge protection,
timers and adaptor products; and
-- Ross: television wall mounts, audio visual accessories and other items.
Luceco's long-established BG brand commands a loyal following
amongst professional electrical contractors in both the UK and
overseas. It is synonymous with quality, safety, innovation and
value for money. The production of BG wiring accessories is the
main focus of the Group's Chinese manufacturing facility, allowing
it to control product quality, cost and availability.
The Luceco and Kingfisher LED lighting brands combine to present
a comprehensive range of indoor and outdoor LED lighting solutions.
The range focuses largely on professionally installed products with
an emphasis on performance and quality. The Group is able to
support these products by offering customers access to its in-house
installation design team.
Masterplug is the market leading brand in the UK Portable Power
category. It is sold largely to consumers through retail
distribution and online. Its products are offered in a wide range
of global electrical standards and they are sold in every territory
in which the Group operates.
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 Group has no obligation to update
these forward-looking statements. Nothing in this announcement
should be construed as a profit forecast.
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END
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