REG - 600 Group PLC - Trading Update

600Announcement

21/02/2020 07:00

For best results when printing this announcement, please click on link below:
http://pdf.reuters.com/htmlnews/htmlnews.asp?i=43059c3bf0e37541&u=urn:newsml:reuters.com:20200221:nRSU6781Da

RNS Number : 6781D  600 Group PLC  21 February 2020

21 February 2020

The 600 Group PLC

 

 

Trading Update

 

 

The 600 Group PLC ("the Group"), the diversified industrial engineering
company (AIM: SIXH), today announces a trading update in respect of the
current year (FY 28 March 2020).

 

In December the Group reported that it had been experiencing certain
macro-economic and political uncertainties across its end markets,
particularly in the Far East and automotive markets, with order intake for the
fourth quarter expected to be significantly below originally predicted levels.

 

Trading conditions have since become more challenging with the combination of
the General Motors strike in USA plants at the end of last year and the
suspension of manufacture by Boeing of its 737 MAX in January this year
 further impacting hundreds of thousands of suppliers across our core
industrial markets. Order intake in both Machine Tools and Industrial Laser
Systems therefore remains volatile, including two significant projects that
have been pushed into the next financial year.

 

In addition, the Coronavirus is causing disruption to shipping from the Far
East. Whilst the Group has no significant volume of sales and little direct
sourcing from Mainland China, the effect of delays to deliveries is pushing
sales past the end of the March financial year.

 

Across UK operations, there continues to be good progress with orders up over
100% on the prior year. The Group is also pleased to report that contracts
have been exchanged for the sale of the Gamet Colchester site for $0.5m. This
sale is part of the Group's rationalisation of the UK operations of its
Machine Tools division to reduce operational risk and capital expenditure
requirements. Completion is expected in the next few days with the proceeds
used to reduce bank debt.

 

As a result of the market volatility described above and the expected
resultant shortfall in revenue against a relatively fixed cost base, the
outturn for the full year is now expected to be significantly below the
Board's previously revised expectations.

 

Despite these major headwinds, the Board continues to believe in the long-term
fundamentals of the Group, which benefits from a significantly enhanced
financial position, and remains optimistic for the future as it continues to
pursue its strategy of de-risking and diversifying the business.

 

 

ENDS

 

 

Enquiries:

 

 The 600 Group PLC                Tel: 01924 415000

 Paul Dupee, Executive Chairman

 Neil Carrick, Finance Director

 Instinctif Partners              Tel: 0207 457 2020

 Mark Garraway

 James Gray

 

 Spark Advisory Partners Limited (NOMAD)  Tel: 020 3368 3553

 Matt Davis

 WH Ireland (Broker)                      Tel: 020 7220 1666

 Harry Ansell

 

This announcement contains inside information for the purposes of Article 7 of
EU Regulation 596/2014

 

 

 

 

About The 600 Group PLC

 

The 600 Group PLC is a distributor, designer and manufacturer of industrial
products with three principle areas of activities:

Machine Tools

The business has a strong reputation in the market for metal turning machines.
Products range from small conventional machines for education markets, CNC
workshop machines and CNC production machines. Selected outsourcing partners
support the manufacturing of these machines and they are marketed through the
Group's wholly owned international sales organisation and a global
distribution network.

Precision Engineered Components

Machine spares are distributed to customers globally to help maintain the
installed base of group machines which number in excess of 100,000.
Additionally, work holding products are sold via specialist distributors to
OEMs, including other machine builders.

Industrial Laser Systems

Industrial laser systems cover laser marking and processing including cutting,
drilling, ablation and a host of other niche applications in the marking and
micro machining sectors. They require no consumables, can operate on a
continuous high speed basis and can be integrated into customers' production
lines. The businesses have their own technology and proprietary software.
Customer applications are diverse and range from aerospace to medical and
pharmaceuticals. The requirement for increased product and component
traceability is one of the market drivers.

More information on the Group can be viewed at: www.600group.com
(http://www.600group.com/)

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.   END  TSTZZGZZZGLGGZZ