NEWS RELEASE Issued on behalf of Flowtech Fluidpower plc Immediate Release |
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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.
FLOWTECH FLUIDPOWER PLC
("Flowtech", the "Group" or "Company")
Q3 Group Trading Update
"The Group's strong performance reflects the mix of further organic growth, up 12.4%,
and, acquisitive developments linked to consistent stable margins"
London: Tuesday, 17 October 2017: AIM listed specialist technical fluid power products supplier Flowtech Fluidpower plc (LSE: symbol FLO), issues the following unaudited Q3 Trading Update for the nine-month financial reporting period ended
30 September 2017:
GROUP Trading Update
Group revenue during the first nine months of the current year increased by 34.4%. Our strong performance is being driven by continued momentum across all the business divisions and further enhanced by the contribution from new subsidiaries.
Revenue for the nine-month period ended 30 September 2017 |
|
YTD 2017 |
PYTD 2016 |
Growth |
Flowtechnology |
£28.33m |
£26.62m |
6% |
Power Motion Control (PMC) |
£21.61m |
£11.88m |
82% |
Process |
£4.51m |
£2.00m |
126% |
Total Group revenue for the period |
£54.45m |
£40.50m |
34% |
Net debt |
£12.10m |
£15.70m |
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Since reporting our HY1 2017 results and market update in early September the business has experienced a solid trading period which remains in line with market expectations. Of note is organic sales growth in the Q3 period of 12.4%. The comparative quarter in 2016 reflects the period immediately following the June Brexit vote when markets and currencies softened, and consequently a strong rebound was expected. However, it is pleasing to report that combined with this expected uplift we delivered further organic growth through a mixture of price increases and strong volume gains at consistent gross margins - this is further evidence that our multi-channel strategy is gaining traction.
ACQUISITONS
Since the start of this financial year we have concluded six acquisitions of which, the following three were concluded during Q3:
· UK: Orange County (OCL) and Group HES
· Europe: Hydroflex Hydraulics (Hydroflex)
These acquisitions have all added or enhanced the Group's position with key European and global suppliers (such as Eaton Corporation, Danfoss Power Solutions, Parker Hannifin, Brugg Pipesystems and Ebsray Pumps), broadened our sector and geographical coverage, and added to our technical competence. Our four-channel approach to the creation of a fluid power specialist group is continuing to present further prospects for expansion, and the Board believes that the Group can continue to exploit this "pipeline" in both the short and medium term, whilst at the same time ensuring that net bank borrowings remain well within facilities.
INVESTMENT FOR THE FUTURE
By way of an update since the HY Report, the redesigned Shared Logistics Centre in Skelmersdale is now expected to be completed by the end of October. As well as modernised office and conference facilities, the enhanced layout will offer an increase in capacity of around 40% and, will deliver operational and stocking improvements for use by all our Profit Centres. It will also provide considerable scope for both the profitable integration of future acquisitions to the Group, and provide scope for further organic growth within the current portfolio. The process has been completed with no disruption to the market leading service level offered by the Skelmersdale operation. At the date of this announcement, we are currently working towards securing a dedicated new site in Knowsley, on Merseyside for our Shared Engineering Centre. This initiative when launched will enhance the Primary Fluid Power operation based nearby and underpin our objective of creating a Centre of Excellence and become recognised as a complete service provider to the fluid power sector. As we announced last week we are also to officially launch our Onsite Services Division in 2018.
SUMMARY
Our focus remains growth through both acquisitive and organic means backed up by our four-layered approach to extracting synergistic benefits over the short, medium and long term. This targeted approach ensures we can achieve both a concentration and enhancement to our product set which is the core of our business model.
The Board believe that the acquisitions so far, this financial year clearly reinforce the ongoing strategy to develop a focused Fluid Power Group that serves a wide number of industry sectors, allowing a de-risking of some of the cyclic nature of the business.
The Group's current performance will deliver another year of solid progress. As a business, we are confident in our strategy, commercial opportunities and the prospects of the Group and, the business remains on track to meet current market expectations for the year ending 31 December 2017.
Enquiries: Flowtech Fluidpower plc Sean Fennon, Chief Executive Bryce Brooks, Chief Financial Officer Tel: +44 (0) 1695 52796 Email: [email protected] |
Zeus Capital Limited (Nominated Adviser and Broker) Andrew Jones, Alistair Donnelly (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, Emily Morris (sales & broking) Tel: +44 (0) 20 7220 0500 TooleyStreet Communications (IR and media relations) Fiona Tooley Tel: +44 (0) 7785 703523 or email: [email protected] |
EDITORS NOTES |
To listen to an interview with CEO, Sean Fennon and CFO Bryce Brooks from 07.00hrs, please go to Live link: https://www.brrmedia.co.uk/broadcasts-embed/59e4eb91affa4e6b10c67b29/event&popup=true |
About Flowtech Fluidpower plc |
Founded as Flowtech in 1983, the Flowtech Group is the UK's leading specialist supplier of technical fluid power products. The business joined AiM in 2014. Today, the Group has four distinct divisions: |
Division: |
What we do: |
Locations: |
Flowtechnology |
Focus on supplying distributors and resellers of industrial MRO products, primarily serving urgent orders rather than bulk offerings. It offers an unrivalled range of OEM and Exclusive Brand products to over 3,400 distributors and resellers. The catalogue is recognised as the definitive source for fluid power products, containing 100,000 individual product lines and are distributed to more than 80,000 industrial MRO end users. |
Flowtechnology Benelux (Deventer) Flowtechnology China (Guangzhou) Flowtechnology UK (Skelmersdale) Indequip (Skelmersdale) |
Power Motion Control (PMC) |
Specialise in the design, assembly and supply of engineering components and hydraulic systems and is further enhanced by a service and repair function. |
Primary Fluid Power (Knowsley) Nelson Fluid Power (Dublin, Lisburn, Dungannon) TripleSix (West Yorkshire) Albroco (Knowsley) Hydraulics & Transmissions (Ludlow) HiPower Hydraulics (Cork, Dublin, Belfast Manchester) Hydroflex (Brussels, Rotterdam and OudBeijerland) Hydraulic Equipment Supermarkets (Gloucester, Leeds, Birmingham, Durham) Branch Hydraulics (Gloucester) |
Process |
Focus on the supply of industrial components and solutions to the process sectors. |
Hydravalve (Willenhall) Orange County (Spennymoor) |
Onsite Services |
In 2018, the Group will extend its service offering to include Onsite Technical Maintenance through highly skilled engineers. |
HES Onsite (Durham, Leeds, Birmingham, Gloucester) |
All four of the Group's divisions have overlapping product sets, allowing procurement synergies to be maximised. |
The above divisions are supported by a centralised back office team at the Skelmersdale site and a procurement and quality control team in Shanghai. In total, the business employs over 400 people. For more information please visit, www.flowtechfluidpower.com |
