Trading Update

600

15/04/2021 07:00

RNS Number : 5165V

600 Group PLC

15 April 2021

 

Prior to publication, the information contained within this announcement was deemed by the Group to constitute inside information. With the publication of this announcement, this information is now considered to be in the public domain.

 

 

15 April 2021

 

 

The 600 Group plc

 

(the "Group")

 

Trading Update

 

The 600 Group plc, the diversified industrial engineering company (AIM: SIXH), announces a trading update for the financial year ended 31 March 2021.

 

Despite the exceptional impact of COVID-19 on the Group's businesses and world economy, the Group is expected to report revenues of approximately $53 million, down over 20% on the prior year. Despite this reduction in revenues, the Group expects to report underlying EBIT of approximately $2.5 million for the full year due to the implementation of operational cost savings and government assistance programmes.

 

The Group's performance is above the Board's post-pandemic expectations, and the strong increase in order activity in March improved the overall orderbook to approximately $14 million as at 31 March 2021, almost 70% above the prior year. Over the last few weeks, activity has significantly increased, with a further $4 million of orders already received so far in April. This much improved order book is particularly strong in the higher margin custom laser side of the business, providing a strong platform for the Group to grow in the current financial year and benefit from operational gearing within the businesses.

 

The Group has pleasingly been able to largely maintain pre-pandemic employment levels, with assistance from government furlough in the UK and Australia, and forgiveness of USA Government Paycheck Protection Program ("PPP") loans. This should enable to the Group to ramp up operations sufficiently to match the increase in order book.

 

Further to the update on 2 March 2021, the remaining $0.6 million of the $2.2 million applied for in new PPP loans was received in late March 2021. These loans are on the same terms as the initial PPP loans, and thus will be eligible for forgiveness from September 2021 dependent on employment numbers, payroll expenditure and certain facility costs, with any amount not forgiven repayable over a two-year term with an all-in interest rate of 1.0%.

 

Group net debt (excluding IFRS16 leases) and including the second round $2.2 million of PPP funding loans was $13 million at the 31 March 2021 financial year end, which compares to $14.2 million at the end of March 2020.

 

Paul Dupee, Group Executive Chairman, commented:

 

"The particularly strong order activity over the last two months, supported by a level of government assistance, has enabled the business to maintain its skilled workforce during the pandemic. This has allowed us to respond quickly to recent demand and significantly improve the size and quality of the Group's orderbook, leaving the business well placed as markets improve."

 

 

Enquiries:

 

The 600 Group PLC
Paul Dupee, Executive Chairman
Tel: 01924 415000
Instinctif Partners
Mark Garraway
Rosie Driscoll
Tel: 0207 457 2020
Cenkos Securities plc (Nominated Adviser and Broker)
Ben Jeynes / Max Gould (Corporate Finance)
Alex Pollen (Sales)
Tel: 020 7397 8900

 

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 and 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  

 

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