Mincon Group
PLC
("Mincon" or the
"Group")
Q1 2024 TRADING
UPDATE
Dublin, London 7 May 2024: Mincon Group plc (Euronext:MIO; AIM:MCON), the Irish
engineering group specialising in the design, manufacture, sale and
servicing of rock drilling tools and associated consumable
products, today provides a trading update for the period from 1st
January 2024 to date, incorporating the first quarter to 31st March
2024.
Q1
continued to be challenging with emerging positive signs of
recovery in Q2
As previously noted, the subdued
market environment in H2 2023 continued over into the new year,
with Q1 2024 revenues broadly flat compared with Q4 2023.
During Q1 2024, we saw some contraction in construction activity in
North America and Europe and a slight contraction in our mining
& geothermal/waterwell revenue which have had an adverse impact
on Group margins. However, toward the end of Q1, order books have
begun to recover. This has given us optimism for our performance in
Q2 2024 and the remainder of the year.
Though mining has contracted
slightly in the period, we have more recently seen specific large
mining customers return to a more regular ordering process as they
have now largely normalised their inventory levels post the Covid
pandemic. We have the capacity in our factories to increase our
production in Q2 which will give us momentum to build back our
profits for the remainder of 2024.
Orders for large construction
projects did not materialise in Q1, however the pipeline for these
projects remains strong. We are hopeful that, if there is more
clarity on the interest rate environment these projects will be
progressed in H2 2024.
Continued focus on driving operational efficiency across the
business
We have committed management
resources to conduct a root and branch review of our operations to
ensure we support our long-term focus on increasing the profitable
parts of the business and driving operational efficiency. We have
made further progress year to date on reducing our working capital
position, specifically through the reduction of our inventory
holding.
As part of our ongoing review of the
business we have decided to close our carbide manufacturing
business in Sheffield. This will take effect later this year and in
the meantime the business will continue to supply our bit
manufacturing subsidiaries with carbide while those Mincon
companies transition to alternative and lower cost carbide
supply.
Positive signals in product development
We are pleased with progress on our
major product development projects including Greenhammer and
Subsea. Greenhammer is running on an extended (and remunerated)
test on a copper mine in Arizona in conjunction with one of the
world's leading rig manufacturers with positive results. Subsea has
met a number of key milestones with some of the leading developers
in offshore wind in attendance to witness same.
Outlook
After a difficult start to the year,
we are positive about the outlook for the remainder of 2024 and are
confident that the changes made on foot of the business review
allied with the positive impact of our new products will drive
margins and growth in the longer term.
Ends
7th May 2024
For
further information please contact:
Mincon Group plc
Joe Purcell - Chief Executive
Officer
Tel: +353 (61) 361099 Mark McNamara - Chief Financial
Officer
Tom Purcell - Chief Operations
Officer
Davy Corporate Finance (Nominated
Adviser, Euronext Growth Listing Sponsor and Joint
Broker)
Anthony
Farrell
Tel: +353 (1) 679 6363
Daragh O' Reilly
Shore Capital (Joint Broker)
Malachy
McEntyre
Tel: +44 (0) 20 7408 4090
Mark Percy
Daniel Bush
Forward looking statements:
Any forward-looking statements made in this document represent the
Board's best judgment as to what may occur in the future. However,
the Group's actual results for the current and future financial
periods and corporate developments will depend on a number of
economic, competitive and other factors, some of which will be
outside the control of the Group. Such factors could cause the
Group's actual results for future periods to differ materially from
those expressed in any forward-looking statements included in this
announcement.
About Mincon:
Mincon specialises in the design,
manufacture, sale and servicing of rock drilling tools and
associated products. The Group's strategy is to increase its share
of the global rock-drilling consumables market through organic
growth and acquisitions. Its manufacturing facilities are located
in Ireland, the UK, Finland, the USA, South Africa, Canada, Sweden
and Australia. The Group also maintains a network of sales and
distribution companies in a number of international markets to
provide after sales support and service to customers.