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6 August 2024
Epwin
Group Plc
("Epwin",
the "Company" or the "Group")
Half-year trading update and notice of
results
Underlying operating profit
in line with a strong 2023 comparative; confident of achieving full
year expectations
Epwin Group Plc (AIM:
EPWN), the leading
manufacturer of energy efficient and low maintenance building
products, with significant market shares, supplying the Repair,
Maintenance and Improvement ("RMI"), new build and social housing
sectors, is pleased to
announce its half-year trading update in respect of the year ended
31 December 2024 ("FY 2024").
Trading
update
Trading during the first half of
2024 continued in line with the Board's expectations.
As reported at the AGM update in
May, the Group has continued to responsibly manage the balance
between volume and margin, with underlying
operating profit for the half-year ended 30
June 2024 in line with a strong prior year
comparative and Board expectations. Operating margins are ahead of
the prior half year.
As expected, revenues were behind
the strong prior year comparative, as a result of
lower PVC input prices reducing previously levied
surcharges and demand remaining subdued in new build and RMI
markets, as widely reported across the
sector. Underlying turnover, excluding
surcharges, was 8% lower than H1 2023 but only 2% behind H2
2023.
The Group retains a strong balance sheet with
covenant net debt as at 30 June 2024 remaining low at £19.5 million
(31 December 2023: £14.4 million), equivalent to 0.6x adjusted
EBITDA, having paid the final dividend of £4.0m and purchased £3.3m
(net) of shares under the share buy-back programme in the period.
This provides the Group with over £55 million of headroom on its
facilities to support its strategic objectives, including value
enhancing acquisitions.
Shareholder returns
The Board continues to return
capital to shareholders both by way of our ongoing dividend policy
and share buyback programme.
The initial buyback programme,
which completed in April
2024, was extended by a further 3 million ordinary shares.
Since the extension, 2.7 million shares have been re-purchased and
cancelled at an aggregate cost of £2.4 million before
fees.
The Board will continue to monitor
the progress of the buyback programme and, whilst there is no
guarantee that the extended programme will be completed in full,
it is currently envisaged that it will
complete no later than 30 September 2024.
Outlook
The Group remains confident of
delivering underlying operating profit for the year in line with
market consensus expectations 1, continuing to grow
profitability and shareholder value, as well as making
further strategic and operational
progress.
The Group's broad product range,
diverse customer base and operations, longstanding supplier
relationships and strong balance sheet continue to provide a large
measure of resilience against any short-term changes in market
conditions.
The medium to long-term drivers of
Epwin's end markets remain positive, with the UK still
facing a shortage of new and affordable housing and a new
Government committing to increasing the number of homes built, an
ageing and underinvested housing stock and increasing concern about
the quality of social housing. Environmental concerns are also
driving legislation and initiatives that will require improvements
to homes on a larger scale than simply that of essential
maintenance, with the need to decarbonise the UK housing
stock and improve the energy efficiency of homes growing in urgency
given the UK's net zero commitments.
Notice of results
The Group expects to announce its
results for the half-year ended 30 June 2024 on 11 September
2024.
Jon Bednall, Chief Executive
Officer, said:
"Trading in the first half was
consistent with the Board's expectations with underlying profit in
line with a strong 2023 comparative, in what continue to be
challenging markets.
We remain confident of achieving our
full year expectations, with a further year of profit progression,
and have a positive view of our future prospects despite the
short-term macroeconomic headwinds. Looking further ahead, the
medium and long-term drivers for the Group's products remain
positive."
(1) Based on Company compiled consensus, the Board believes the
average analyst forecast for 2024, underlying operating profit to
be £25.8 million (within a range of underlying operating
profit expectations of £25.6m to £26.1m).
Ends.
Contact
information
Epwin Group Plc
Jon Bednall, Chief
Executive
Chris Empson, Group Finance
Director
|
078 3462
3818
|
Shore Capital (Nominated Adviser and Joint
Broker)
Corporate Advisory
Daniel Bush / Harry
Davies-Ball
Corporate Broking
Fiona Conroy
Zeus Capital Limited (Joint Broker)
Dominic King / Nick
Searle
|
0207 408 4090
0203 829
5000
|
MHP
Reg Hoare / Matthew Taylor / Finn
Taylor
|
078 3462
3818
epwin@mhpgroup.com
|
About
Epwin
Epwin is the leading manufacturer of energy
efficient and low maintenance building products, with significant
market shares, supplying the Repair, Maintenance and
Improvement ("RMI"), new build and social housing
sectors.
The Company is incorporated, domiciled and
operates principally in the United Kingdom.
Information for investors can be
accessed
www.epwin.co.uk/investors/