TIDMFLO
RNS Number : 8390M
Flowtech Fluidpower PLC
26 January 2021
The information contained within this announcement is deemed by
the Company to constitute inside information stipulated under the
Market Abuse Regulation (EU) No. 596/2014. Upon the publication of
this announcement via the Regulatory Information Service, this
inside information is now considered to be in the public
domain.
Tuesday, 26 January 2021
FLOWTECH FLUIDPOWER PLC
("Flowtech", the "Group" or "Company")
Specialist full-service supplier of technical fluid power
products and services
2020 TRADING UPDATE
The Board of Flowtech issues the following unaudited Trading
Update ahead of the Group's preliminary results which are scheduled
to be released during April 2021.
OVERVIEW
In line with the challenging market conditions experienced as a
result of the COVID-19 pandemic, we expect to report 2020 revenue
of GBP95.1m, a 15% reduction against a 2019 figure of GBP112.4m.
The majority of this reduction was seen in our Components
Division.
Revenue for the year ended 31 December 2020
Divisions: 2020 2019 Reduction
Unaudited Audited
GBPm GBPm
------------------------- ----------- --------- ----------
Components 79.6 96.3 (17%)
Services 15.5 16.1 (4%)
Total Group revenue for
the period 95.1 112.4 (15%)
----------- ---------
Net debt* 11.7 16.6
------------------------- ----------- --------- ----------
Prior to the first national lockdown in March 2020, and in
particular the closure of certain customer sites, revenue was
slightly ahead of our expectations. The impact of the pandemic
resulted in April revenue being 41% down compared with April 2019
and Q2 33% down against Q2 2019. Since April, our revenues have
recovered; H1 was 22% down and H2 8% down against comparative 2019
periods.
Data we obtain from the British Fluid Power Association
(relating to the period up to November 2020) suggests we have
achieved a modest increase in market share in 2020.
NET DEBT
Net debt* at 31 December 2020 was GBP11.7m (comprising GBP10.8m
net bank debt and GBP0.9m of COVID-19 related support from HMRC
which will be repaid by end March 2021). This represents a GBP4.9m
reduction compared with GBP16.6m at 31 December 2019.
Our continued focus on working capital management, combined with
a small underlying profit **, has underpinned this result. The
trend of cash generation is expected to continue into 2021.
We renewed our Banking facilities in November 2020 and now have
continuing aggregate GBP25m facilities in place for a three-year
period. The covenants have been adjusted to align with current
trading conditions.
DELIVERING ON OPERATIONAL COST SAVINGS
Despite the difficulties presented by COVID-19 restrictions, we
have completed all the cost reductions outlined in our 2020 half
year report. However, the lockdown measures and working from home
environments, combined with restrictions on travel, have meant it
was not possible to progress with certain of the further identified
cost reductions. We will complete the remaining areas in 2021.
OUTLOOK
The Group has continued to ensure that the health and wellbeing
of all its stakeholders and, in particular, our employees remains
paramount. Away from this the continued progress made with reducing
underlying operating costs has ensured that financial performance
has, in the circumstances we have faced, remained satisfactory and
provides a good base for the future. However, it clearly remains
difficult to forecast accurately given the ongoing impact of, and
uncertainty caused by, COVID-19 and therefore we will continue to
keep our dividend policy and re-instatement of formal earnings
guidance under review and will comment further as soon as we feel
it is prudent to do so.
Roger McDowell, Non-Executive Chair commented:
" In what has proven to be an extremely difficult year the
wellbeing of our staff and the protection of the business have been
our two key priorities. I am pleased to report the senior
management team, supported by everyone throughout Flowtech, have
delivered on both counts. The continued focus on cash has put us in
a healthier position to deal with the prevailing market conditions.
Whilst not underestimating the difficulties, we are cautiously
optimistic of improving performance in 2021."
Notes
* Our reported Net debt figure does not take account of IFRS16
related debt - this has remained stable with no new significant
lease commitments entered into. The reported figure comprises
GBP10.8m net bank debt and GBP0.9m of COVID-19 related support from
HMRC which will be repaid by end March 2021.
** Underlying profit is profit before tax and separately
disclosed items which comprise costs relating to amortisation,
restructuring, acquisition and share based payments.
ENQUIRIES:
----------------------------------------------------------
FLOWTECH FLUIDPOWER PLC
Roger McDowell, Non-Executive Chair
Bryce Brooks, Chief Executive Officer
Russell Cash, Chief Financial Officer
Tel: +44 (0) 1695 52759
Email : info@flowtechfluidpower.com
Zeus Capital Limited (Nominated Adviser and Joint Broker)
Andrew Jones, Kieran Russell (Corporate Finance)
Dominic King, John Goold (Sales & Broking)
Tel: + 44 (0) 20 3829 5000
finnCap Limited (Joint Broker)
Ed Frisby, Kate Bannatyne (Corporate Finance)
Rhys Williams, Andrew Burdis (Sales & Broking)
Tel: + 44 (0) 20 7220 0500
TooleyStreet Communications (IR and media relations)
Fiona Tooley
Tel: +44 (0) 7785 703523
or email: fiona@tooleystreet.com
ABOUT FLOWTECH FLUIDPOWER PLC
Founded as Flowtech in 1983, the Flowtech Fluidpower Group is the UK's
leading specialist supplier of technical fluid power products and services.
The business joined AIM in 2014 (AIM: Symbol FLO). Today, the Group
has two distinct divisions:
Division: What we do: Locations:
----------- ------------------------------------------- ----------------------------------
Components Supply of hydraulic and pneumatic Flowtechnology Benelux
consumables, predominantly through (Deventer)
distribution for urgent maintenance Flowtechnology UK (Skelmersdale)
and repair operations across Indequip (Skelmersdale)
all industry sectors. Additionally, Beaumanor (Leicester)
support a broad range of original Hydravalve (Oldbury)
equipment manufacturers (OEMs) Primary Fluid Power Components
supplying off-the-shelf and tailored (Skelmersdale)
components and assemblies. Nelson Hydraulics (Dublin,
Dungannon)
HTL (Ludlow)
Hi-Power Hydraulics (Cork,
Dublin, Belfast, Knowsley)
Hydroflex (Brussels, Rotterdam
and OudBeijerland)
Hydraulic Equipment Supermarkets
(Gloucester)
Derek Lane & Co (Newton
Abbot)
Tractec (Gloucester)
----------- ------------------------------------------- ----------------------------------
Services Bespoke design, manufacturing, Primary Fluid Power Systems
commissioning, installation, (Knowsley)
and servicing of systems to manufacturers Branch Hydraulic Systems
of specialised industrial and (Gloucester)
mobile hydraulic original equipment Lubemec (Gloucester)
manufacturers (OEMs) and additionally Fluidpower Group Services
a wide range of industrial end (Spennymoor, Leeds, Gloucester)
users. Orange County (Spennymoor)
----------- ------------------------------------------- ----------------------------------
Both Group's divisions have overlapping product sets, allowing procurement
synergies to be maximised.
The above divisions are supported by a centralised back office team
based in Wilmslow, Cheshire, UK. In total, the business employs c.600
people. For more information please visit, www.flowtechfluidpower.com
.
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END
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