8 July 2025

Victrex plc - Q3 Trading Update

Volume momentum continues; Medical Spine remains challenging

Victrex plc is an innovative world leader in high performance polymer solutions, delivering sustainable products which support CO2 reduction and enable environmental and societal benefit in multiple end-markets. Today's trading update for Q3 covers the period 1 April 2025 to 30 June 2025.

Q3 summary:

·      Continued Q3 volume momentum: sales volume +8% vs Q3 2024

o  Volume growth driven by Sustainable Solutions

o  Softer than expected Medical revenues, driven by Spine

o  Sales mix adversely impacted revenue and ASP

·      Cost discipline remains strong

·      Continuation of Q3 sales mix and ASP trends in Q4 would lead to a broadly similar H2 underlying PBT result, versus H1

Q3 volume & revenue:

Sustainable Solutions driving volume growth

Across Sustainable Solutions, Energy & Industrial and VARs were the main drivers of growth in Q3, compared to the prior year. In Aerospace, sales volumes were stable against tougher comparatives, with Automotive also stable and Electronics ahead year-to-date.

Medical remains soft

Medical performance was lower than our expectations. Whilst we continue to see good growth in Non-Spine, this was not sufficient to deliver overall divisional improvement during the period. Spine remains the most impacted application area within Medical, including impacts from industry destocking, the effects from Volume Based Pricing (VBP) in China and alternative materials in the US Spine market.

Price, mix & currency effects

Average selling price (ASP) in Q3 of £68/kg (Q3 2024: £76/kg) was impacted by similar factors as H1 including lower Medical revenues, adverse mix within both Medical and Sustainable Solutions and competitive pricing, primarily in VARs.

Currency increased in impact during Q3 to account for nearly one-third of the year-on-year ASP impact in the quarter.  As a result of declining ASP, volume growth of 8% in Q3 translated to a revenue decline of 3%.  A continuation of similar ASP trends during Q4, versus the prior year, is expected.

China: production rates improving

In our new China manufacturing facility, we are making progress in resolving initial scale-up challenges. Production rates slightly improved during Q3 and product is being delivered to customers.    

Mega-programme milestones

During the period, we saw the first PEEK Knee surgeries for the US clinical trial, bringing the total number of patient implants, including in Europe and India, to 65.  In Magma, following the announcement from TechnipFMC for a technological order award from Petrobras, we are supporting TechnipFMC with pipe extrusion programmes as part of advanced qualification work.

Robust financial position

The Group is on track for lower capital expenditure (at the lower end of our 8-10% of revenue guidance for the full year). Inventory is also reducing on plan. Net debt on 30 June 2025, after payment of our interim dividend on 27 June, was £42.8m (Q3 2024: £39.6m), which includes cash of £19.7m.

Currency remains a headwind to profit for FY 2025. The impact of currency at PBT level is now closer to £9m, at the higher end of our guidance. With further strengthening of Sterling against the US dollar and Euro, currency for FY 2026 is now tracking at approximately £3-4m adverse to FY 2025. Currently, hedging is in place to cover over 50% of our US dollar and Euro foreign currency exposure in FY 2026 and this cover will increase to c75% by 30 September.

Outlook

Jakob Sigurdsson, Chief Executive, said: "Overall Q3 trading saw continued volume momentum, offset by a softer than expected performance in Medical and further adverse sales mix within Sustainable Solutions.

"The Group is well positioned to deliver at least high single digit volume growth for the full year, in line with guidance, although the remainder of FY 2025 sees a tougher comparative and we are mindful of ongoing macroeconomic uncertainty. At profit level, our range of outcomes reflect the impact of an adverse sales mix in both divisions, a weaker Medical performance and the headwinds from our new China manufacturing facility, as well as a c£9m currency headwind. Whilst we are targeting H2 underlying PBT to be slightly improved on H1 underlying PBT of £23.2m, a continuation of Q3 sales mix and ASP trends for the remainder of the year, particularly in Medical Spine, would result in H2 underlying PBT being at a broadly similar level as H1.                 

"As we navigate macroeconomic uncertainty, the Group has strong cost discipline and improvement actions in place. These include Project Vista and our focus on Sales Excellence. Overall, we have confidence in our medium to long-term growth prospects, well invested assets and an improving cash position."

Victrex will report its FY 2025 Preliminary results on Tuesday 2 December 2025.

Analyst & investor call:

A call for analysts & investors will be held today, Tuesday 8 July, at 08.30am UK time. To register for the call or listen to the replay, please follow this link:

Victrex Q3 Interim Management statement Registration Page!

Victrex plc:

About Victrex:

Victrex is an innovative world leader in high performance polymer solutions, focused on the strategic markets of Automotive, Aerospace, Energy & Industrial, Electronics and Medical. Every day, millions of people rely on products or applications which contain our sustainable materials, from smartphones, aeroplanes and cars to oil & gas operations and medical devices. With over 40 years' experience, we are moving beyond the polymer into semi-finished and finished products which shape future performance for our customers and our markets, enable environmental and societal benefit for our customers and drive value for our shareholders. Find out more at www.victrexplc.com

This Q3 Trading Update is based upon unaudited management accounts information. Forward-looking statements have been made by the Directors in good faith using information available up until the date that they approved this statement. Forward-looking statements should be regarded with caution because of the inherent uncertainties in economic trends and business risks.