TIDMTRI
RNS Number : 4517X
Trifast PLC
26 April 2023
Trifast plc
("Trifast" or "Group" or "Company")
Trading Update
London, Wednesday, 26 April 2023 : Trifast (LSE: Main Market
symbol: TRI) provides the following trading update for the
financial year ended 31 March 2023 ("FY23") ahead of its Annual
results scheduled to be announced in mid-July 2023.
Highlights
* Q4 FY23 performance enabled delivery of short-term
profit and cash objectives:
o Adjusted profit before tax marginally ahead of the February 2023 guidance;
o Inventory decrease in line with expectations; and
o Net debt (before IFRS16) reduced to GBP38m, within both facility headroom
and covenant levels
* Growth momentum sustained through the final quarter,
contributing to record level of contract wins for the
year (GBP25.6m)
* UK operational review leading to organisational improvements
* More resilient business entering FY24 and expect
increasing benefits from commercial and cost
initiatives
Trading performance
Revenue for the 12 months ended 31 March 2023 is expected to be
c .GBP245m (FY22 GBP218.6m). Organic growth, at constant currency,
was c .7% with the performance from our US operations being a
particular highlight at in excess of 25%.
As a result of this and pricing actions, the Group expects
adjusted profit before tax for the year marginally ahead of the
adjusted PBT guidance of GBP9.0m provided in February.
Reflecting its confidence in the prospects for the business, the
Board intends to propose an increased final dividend of 1.50p.
Update on immediate priorities
As part of a broader review, the February update confirmed three
immediate priorities to drive recovery in the Group's financial
performance.
The Board updates on recent progress across these, as
follows:
1 . Effective pricing - pass through of inflationary cost increases completed
during January. TR VIC returned to profit, with continued focus on improving
gross margins across the Group
2 . Inventory reduction - stock levels reduced by more than GBP10m during
Q4 FY23, with year-end inventory of c .GBP97m (CER), flat year-on-year
3 . Development of a comprehensive margin improvement plan - operational
review ongoing with initial focus on right-sizing Group functions and
the UK region
* Integration of UK and European leadership
* Consolidation of UK footprint, National Distribution
Centre (NDC) to be established, site identified
* Cost savings expected to commence during Q4 FY24
4 . Annualised savings during FY25 now expected to be at least GBP5m,
based on a restructuring cost of c.GBP5m (c.GBP3m cash)
Plan for FY24
It is clear that Trifast's business foundations remain strong,
with significant potential to be realised during the coming year
by:
Ø Establishing a clear customer value proposition
Ø Better accessibility and utilisation of data
Ø Fixing or exiting unprofitable customer transactions
Ø Embedding a revised organisational structure that aligns to business
needs
Ø Managing a further reduction in inventory levels, whilst continuing
to support successful mobilization of new contract wins
Prospects
Whilst FY23 has been disappointing, the new leadership team has
been able to take significant steps across a range of operational
and financial initiatives in a short space of time and the initial
results from the priorities outlined in February have been
encouraging. Further scrutiny of the business in the intervening
weeks underpins the Board's belief in its previously stated KSIs
(Key Strategic Indicators), including a return to double digit EBIT
margins (range 10-13%) in the medium-term.
We are only a few weeks into the new financial year and whilst
the destocking experienced from an Asian customer in the latter
part of FY23 has abated, we remain mindful that the short-term
macroeconomic outlook remains challenging. H owever, we have
entered the new year with a backdrop of new contract wins and a
healthy pipeline. These, together with the benefits from our
operational improvement programmes, support the Board's continued
expectation in delivering a marked improvement in performance in
FY24.
The Company looks forward to updating shareholders further at
the time of the Annual results announcement.
Further enquiries please contact:
Trifast plc
Jonathan Shearman, N on-Executive Chair
S cott Mac Meekin, Interim CEO
D arren Hayes-Powell, CFO
Christopher Morgan, Company Secretary
Tel: +44 (0) 1825 747630
Email: corporate.enquiries@trifast.com
Shareholders: Companysecretariat@trifast.com
Peel Hunt LLP (Stockbroker & financial adviser)
Mike Bell
Tel: +44 (0) 20 7418 8900
TooleyStreet Communications, (IR & media relations)
Fiona Tooley
Tel: +44 (0)7785 703523
or Email: fiona@tooleystreet.com
Editors' notes
About Trifast plc
Trifast (TR) is a leading international specialist in the design, engineering,
manufacture, and distribution of high-quality industrial fastenings and
Category 'C' components principally to major global assembly industries.
The Group supply to customers in c.75 countries across a wide range of
industries, including Light vehicle, Heavy vehicle, Health & Home, Energy,
Tech, and Infrastructure (ET&I), General industrial and Distributors.
As a full-service provider to multinational OEMs and Tier 1 companies
spanning several sectors, TR delivers comprehensive support to its customers
from concept design through to technical engineering consultancy, manufacturing,
supply management and global logistics. We operate through 34 business
locations within the UK, Asia, Europe, and the USA including seven high-volume,
high-quality, and cost-effective manufacturing sites and three technical
& innovation centres across the world.
For more information, visit:
TRIFAST PLC TRI Stock | London Stock Exchange
Our website: www.trifast.com
LinkedIn: www.linkedin.com/company/tr-fastenings
Twitter: www.twitter.com/trfastenings
Facebook: www.facebook.com/trfastenings
Note
Trifast, TR and TR Fastenings are registered trademarks of the Company.
LEI number: 213800WFIVE6RUK3CR22
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with
the Company's obligations under Article 17 of MAR. Upon the
publication of this announcement via the Regulatory Information
Service, this inside information is now considered to be in the
public domain.
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END
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