TIDMLUCE
RNS Number : 5083W
Luceco PLC
19 August 2020
19 August 2020
Luceco plc
Trading Update
Luceco plc ("the Group" or "Luceco"), the manufacturer and
distributor of high quality and innovative wiring accessories, LED
lighting and portable power products, is pleased to provide the
following update on trading ahead of the scheduled announcement of
our interim results on 8 September 2020.
Our first half results remain in line with guidance given in our
pre-close update on 13 July 2020. Since then, our performance has
continued to improve and our expectations for full year 2020
Adjusted Operating Profit have increased from at least GBP18m to at
least GBP23m.
The background to this is as follows:
-- We continue to out-perform the UK market as a result of our
higher share of online / multi-channel capable customers and
consumer/DIY markets, where demand has been robust.
-- As previously announced, activity levels improved steadily in
Q2 2020 as lockdown conditions eased. This trend has continued into
the second half. The business has good visibility of Q3 2020
trading and we now expect a return to low single digit
like-for-like revenue growth in the quarter.
-- The recent improvement has been driven by:
o Continued recovery in demand from professional / wholesale
channels, supplementing the earlier recovery in consumer / DIY
markets.
o Some channel restocking in response to a sustained improvement
in end-user demand.
-- The recovery is particularly benefiting our higher margin,
in-house manufactured product categories, resulting in increased
production efficiency and an accelerated improvement in Group
margins. We therefore expect full year 2020 Adjusted Gross Margin
of approximately 40.0% (FY 2019: 36.2%, H1 2020: 38.4%).
-- Whilst the outlook for Q3 is clearer, the prospects for Q4
remain inherently uncertain, dependent on:
o the macroeconomic impact of government stimulus withdrawal on
employment, consumer confidence and therefore demand; and
o the ongoing risk of a disruptive second wave of coronavirus
infection.
-- We are confident that a confirmed improvement in near-term
demand, improved gross margin and tight control of overheads should
deliver full year 2020 Adjusted Operating Profit of at least GBP23m
provided there is no severely disruptive second wave of coronavirus
infection in H2. This would yield an Adjusted Operating Margin of
at least 14.5%. Significant additional progress is possible if the
second half is unaffected by the macroeconomic uncertainty referred
to above.
-- Furthermore, ongoing work across the Group's global
operations to improve tax efficiency should mean that Adjusted
Earnings Per Share will be at least 11.0p.
John Hornby, Chief Executive Officer, said:
"We are very encouraged by the rate at which demand has returned
to our industry. We are also pleased that our diverse channel
access and product portfolio, combined with our resilient operating
model, have contributed to this continued improvement in
performance.
The outlook for later in the year remains uncertain for all, but
what we know confirms that 2020 should be a year of strong profit
growth for the Group despite very challenging conditions - a
product of a consistent strategy and the unwavering commitment of
the entire Luceco team."
- 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, 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.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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