Half Year Trading Update
21/11/2022 07:00
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RNS Number : 6598G Accrol Group Holdings PLC 21 November 2022
21 November 2022
Accrol Group Holdings plc
("Accrol, the "Group" or the "Company")
HALF YEAR TRADING UPDATE
On track to deliver FY23 results at least in line with market expectations*
Accrol (AIM: ACRL), the UK's leading independent tissue converter, announces
the following trading update ahead of its Half Year Results for the six months
ended 31 October 2022 ("H1 FY23" or the "Period"), which are scheduled to be
released in late January 2023.
The Board is pleased to report that the Group performed strongly in H1 FY23,
delivering substantial growth in volume, revenue and profit, as well as
further strengthening its market position. The Group continues to demonstrate
its resilience against the challenges of input cost inflation, successfully
leveraging its supply position with customers to recover all additional costs
in the Period.
Net debt at 31 October 2022 was lower than anticipated at c.£30.5m, despite a
significant increase in tissue stocks as the Group continued to manage
uncertainty in its supply chains and the effect of strikes at UK ports. The
Group expects this working capital position to improve in H2 FY23 to deliver a
further reduction in its net debt position ahead of current market
expectations* for FY23.
H1 FY23 highlights:
● Revenue up 64% to £121.1m (H1 FY22: £73.7m), with volumes increasing by 14%
in the Period
● Accrol's market share by volume increased further to c.21.5% (FY22: 19.5%),
compared to a flat overall UK market
● As announced in the Group's Final Results FY22 in September, private label
volumes are now higher than pre-pandemic levels - market share growing at an
unprecedented rate against that of the traditional brands (Q1 FY23: 54% vs Q1
FY22: 50%)
● Private label sector has strengthened further since the Final Results and
Accrol volumes have continued to grow ahead of overall UK market with private
label market share standing at c.46% (FY22: 44%)
Outlook
The Group's main market, the discount retailers and private label products
continue to grow strongly, driven by the cost-of-living crisis.
The Group has delivered substantial growth in the Period and the Board is
increasingly confident that the growth trajectory of the business is
sustainable. The volume growth in H1 FY23 is expected to continue as consumers
move away from high-cost, low-value branded products in search of best-value.
Whilst mindful of the wider economic uncertainties, the Group's model is
robust, and the Board considers the Group to be on track to deliver results
for the full year ended 30 April 2023 ("FY23") at least in line with market
expectations* with net debt reducing ahead of expectations to c.1.5x EBITDA by
the end of FY23 (FY22: 3.0x).
* For the purpose of this announcement, the Group believes market consensus
for FY23 to be revenue of £213.5m, adjusted EBITDA of £15.0m, adjusted PBT
of £7.1m and net debt of £26.3m.
Gareth Jenkins, Chief Executive Officer of Accrol, said:
"We are clearly very pleased with these set of results where we have seen
volume growth of 14% against a flat overall UK market performance over the
same period. We have delivered this by having great quality and value products
that meet every consumer's budget. Our strong relationship with the retailers
and our robust supply model is ensuring we can continue to deliver a strong
set of results in a difficult market environment."
For further information, please contact:
Accrol Group Holdings plc
Dan Wright, Executive Chairman Via Belvedere Communications
Gareth Jenkins, Chief Executive Officer
Richard Newman, Chief Financial Officer
Zeus (Nominated Adviser & Broker)
Dan Bate / Jordan Warburton Tel: +44 (0) 161 831 1512
Dominic King Tel: +44 (0) 203 829 5000
Liberum Capital Limited (Joint Broker) Tel: +44 (0) 20 3100 2222
Clayton Bush / Edward Thomas
Belvedere Communications Limited
Cat Valentine Tel: +44 (0) 7715 769 078
Keeley Clarke Tel: +44 (0) 7967 816 525
accrolpr@belvederepr.com
Overview of Accrol
Accrol Group Holdings plc is a leading tissue converter and supplier of toilet
tissues, kitchen rolls, facial tissues, and wet wipes to many of the UK's
leading discounters and grocery retailers across the UK. The Group now
operates from six manufacturing sites, including four in Lancashire, which
together supply c.21.5% (volume) of the UK tissue market valued at c£2.5bn at
retail sales value.
For more information, please visit www.accrol.co.uk
(http://www.accrol.co.uk/) .
Link for Accrol Today video: https://www.accrol.co.uk/our-business/
(https://www.accrol.co.uk/our-business/)
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