18 July 2024
PORTMEIRION GROUP
PLC
('the
Group')
H1 2024 Trading
update
Improved demand across US/UK,
tough macroeconomic backdrop remains in South
Korea
Remain on track to meet Full
Year market expectations
Portmeirion Group PLC, the owner,
designer, manufacturer and omni-channel retailer of leading
homeware brands in global markets, provides an update on its
trading for the six months to 30 June 2024.
Sales for our first, traditionally
quieter half, are expected to be c.£36.5m, down 17% on the same
period last year (and down 16% at constant currency). This is in
line with what was anticipated in the Group's full year results in
March, which stated that H1 sales would be down due to lower order
levels in South Korea. Group sales, excluding the South Korean
market, were up 5% in constant currency.
Encouragingly, sales during the
period in the US, our largest market, were up 4% in constant
currency combined with an improvement in gross margins however
there continues to be a difficult market backdrop. In the UK, sales
were significantly ahead of the prior year aided by further growth
of over 25% in Wax Lyrical, our home fragrance division, which
benefitted from the impact of recent new listing wins in the
grocery channel. In South Korea, sales were down 60% against a
comparison of an abnormally high first half in 2023. Softer
consumer spending in South Korea was compounded by significant
de-stocking by distributors and retailers.
Outlook
We expect FY24 profit to be up on
the prior year with improved operating margins and we remain on
track to meet FY market expectations. We expect sales in the second
half in our South Korean market to be back to broadly in line with
the prior year and we have healthy order books for Christmas across
the US and UK.
The actions we have taken to reduce
our overhead cost base by 10% leaves us better placed to navigate
any continuing macro pressures as trading conditions around our key
markets across the world continue to be unpredictable. We also
continue to manage the increasing disruption to global container
freight shipping together with rising rates.
Mike Raybould, Chief Executive, commented:
"We are pleased with the progress we are making in the US, our
largest sales market, with improving sales and higher gross margins
and also the continued strong growth recovery in Wax Lyrical,
although consumer markets remain uncertain around the world. We are
also encouraged by our advance US orders for Christmas which remain
significantly ahead of last year.
In
South Korea, following a significant stock refill in 2022 and first
half 2023, the more recent consumer slowdown has resulted in
distributors and retailers needing to reduce high stock levels.
This has impacted short term orders for this market however we are
confident that our Portmeirion brand remains ever popular with the
end consumer as evidenced by healthy, growing online channel sales
in the market.
The benefits of our cost restructuring are on track, and this
supports our commitment to growing our operating margins in the
short and long term and we believe that our increasingly
distributed brands are well placed to grow in the medium and long
term."
The Group expects to report its
Interim results for the six months ended 30 June 2024 in the second
half of September 2024.
Notes: This
announcement contains inside information for the purposes of the
retained UK version of the EU Market Abuse Regulation (EU) 596/2014
("UK MAR").
ENQUIRIES:
Portmeirion Group PLC:
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|
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Mike Raybould, Chief Executive
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+44 (0) 1782 743 443
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mraybould@portmeiriongroup.com
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David Sproston, Group Finance Director
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+44 (0) 1782 743 443
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dsproston@portmeiriongroup.com
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|
|
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Hudson Sandler:
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Dan de Belder
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+44 (0) 207 796 4133
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portmeirion@hudsonsandler.com
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Nick Moore
Emily Brooker
|
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Shore Capital:
(Nominated Adviser and Joint
Broker):
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+44 (0) 207 408 4090
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Patrick Castle
Lucy Bowden
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Corporate Advisory
|
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Malachy McEntyre
Isobel Jones
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Corporate Broking
|
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Singer Capital Markets
(Joint Broker):
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+44 (0) 207 496 3000
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Peter Steel
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Investment Banking
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Asha Chotai
|
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NOTES TO EDITOR:
Portmeirion Group PLC is a leading,
omni-channel British ceramics manufacturer and retailer of leading
homeware brands.
Based in Stoke-on-Trent, United
Kingdom, the Group owns six unrivalled heritage and contemporary
brands, with 750+ years of collective heritage; Portmeirion, Spode,
Royal Worcester, Pimpernel, Wax Lyrical and Nambé.
The Group serves markets across the
world, with global demand driven by diversified international
markets including the key geographies of the US, UK and South
Korea.
Portmeirion Group has a proven
capital-light, well developed and self-funded growth strategy
focused on building a wider customer base and growing the sales
footprint of its brands, through:
·
Building and growing international sales
markets
·
Developing online sales channels in core
markets
·
Designing and launching new product to widen
appeal and take market share
·
Leveraging brands and extensive product
ranges