REG - Carclo plc - Trading Statement

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RNS Number : 7135G  Carclo plc  30 April 2025

30 April 2025

Carclo plc

Trading Update

Carclo plc ("Carclo", the "Group" or the "Company"), a global leader in
precision engineering solutions, today issues a trading update for the year
ended 31 March 2025.

Health & Safety Excellence

Prioritising health and safety has resulted in Carclo's Health & Safety
culture becoming fundamentally transformed. This is evidenced by improvement
in a key metric, the Incident Frequency Rate (a measure of the number of
safety incidents per 100,000 hours worked ), which has improved dramatically
from 2.28 in FY24 to 0.69 in FY25 - testament to our identity as a company
that delivers measurable results.

Group Financial Performance and Strategic Execution

The Group's disciplined execution of our strategic priorities - strengthening
the balance sheet, optimising assets, enhancing margins, and delivering global
operational excellence - has yielded substantial progress throughout the
financial year.

Trading performance for the year ended 31 March 2025 exceeded management
expectations, with strong margin expansion in the second half. Net debt
(including leases) closed at £19.3 million, representing a significant
reduction of £10.2 million compared to £29.5 million at 31 March 2024,
reinforcing the Group's financial resilience and strategic flexibility.

As announced on 25 April 2025, a significant milestone was achieved with the
establishment of a new partnership with BZ Commercial Finance DAC, creating a
more robust financial platform that enhances both stability and strategic
flexibility for future growth investment, as well as funding the recovery plan
for the Group Pension Scheme.

Key financial metrics demonstrate material progress towards our medium-term
objectives, with notable improvements in Return on Sales (ROS) and Return on
Capital Employed (ROCE) against our strategic targets of 10% and 25%,
respectively. Cash generation remained consistently strong across the period,
underpinned by enhanced operational performance, disciplined working capital
management and strategic capital allocation.

CTP Design & Engineering

The Design & Engineering (D&E) business has continued its trajectory
of excellence, developing sophisticated, bespoke solutions that address
complex customer challenges while strengthening our technical capabilities.
While the finalisation of several significant projects reduced short-term
revenue, strategic investments in asset revitalisation and next-generation
automation technologies have established a solid foundation for sustainable
operational performance improvements.

CTP Manufacturing Solutions

The strategic restructuring of US operations represents a significant
achievement, culminating in the successful closure of the Tucson facility and
the seamless integration of manufacturing capabilities into Pennsylvania
operations. This consolidation has delivered measurable improvements in asset
utilisation metrics, operational responsiveness, and manufacturing efficiency.

In EMEA, our factory specialisation strategy continues to drive competitive
advantage. The strategic alignment of long-run production excellence at our UK
facility, complemented by agile, medium-run capabilities at our Central
European operation, has created an optimal balance of efficiency and
flexibility. This configuration enables precise alignment with diverse
customer requirements while maximising operational effectiveness across the
EMEA market.

The APAC manufacturing platform has advanced significantly by implementing
advanced multi-component moulding capabilities. This technical enhancement
supports regional customers with expedited delivery timeframes and
substantially reduced supply chain complexity in key growth markets.

The Group's deployment of standardised manufacturing platforms across its
global operations provides significant strategic resilience against ongoing
geopolitical uncertainties. This approach enables production flexibility and
rapid reallocation capabilities, positioning Carclo to navigate regional
disruptions while maintaining continuity of supply for multinational customers
- a competitive advantage in today's complex global trade environment.

Speciality Division

Integrating Aerospace and Light & Motion operations into a consolidated
Speciality Division has delivered exceptional results, achieving record
revenue performance and near-peak profitability. This success reflects robust
market demand and the strategic refocusing of the product portfolio toward
higher-value precision solutions.

Particularly noteworthy is the strategic transformation of precision machining
capabilities, which now constitute 62% of the division's output compared to
27% three years ago. The strategic focus on the Repair, Maintenance, &
Overhaul (RMO) sector, combined with targeted expansion of machining
capabilities across UK and French operations, has generated exceptional
compound annual growth in this high-value segment.

The Aerospace sector has demonstrated robust momentum, with medium-term
strategic expansion into South Asian markets complementing established
operations. This geographical diversification strategy, underpinned by a
commitment to precision engineering excellence, positions the division for
continued sustainable growth in these premium market segments.

Outlook

The Group is well positioned to build upon its positive trajectory,
notwithstanding an increasingly complex global backdrop. Heightened
geopolitical tensions, evolving trade dynamics, and continued volatility in
raw material costs will remain key factors influencing global supply chains.

Under the Group's strategic leadership over the past two years, Carclo has
built a flexible global manufacturing network underpinned by unified "One
Carclo" global standards. Our deliberate strategy of "manufacture in the
region, for the region" - combining regional resilience with globally
consistent quality and service - positions the Group to react quickly and
effectively to geopolitical shifts, trade barriers, and evolving customer
requirements. In an increasingly fragmented world, Carclo's model is not only
resilient but a clear competitive differentiator.

Further margin enhancement is anticipated as the full benefits of operational
optimisation initiatives materialise across all business units. Disciplined
approach to cash management and the ongoing operational excellence programme
are expected to drive sustained financial resilience and strategic
flexibility.

Growth in the medium-term will focus on accelerating expansion in the Life
Sciences sector, where demand for high-precision solutions continues to grow,
alongside continued strong momentum in our Speciality Division, particularly
across aerospace and optical applications. These initiatives are fully aligned
with our strategic ambition to drive sustainable top-line growth and deliver
enduring value for all stakeholders.

We will provide further details in our full-year results for the year ended 31
March 2025, which will be released in July 2025.

THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED TO CONSTITUTE
INSIDE INFORMATION AS STIPULATED UNDER THE MARKET ABUSE REGULATION (EU NO.
596/2014) WHICH IS PART OF UK LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL)
ACT 2018. UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION
IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN

 

 

About Carclo plc

Carclo plc is a public company whose shares are quoted on the Main Market of
the London Stock Exchange. The Carclo Group is a global leader in
high-precision components with comprehensive, end-to-end manufacturing
capabilities. With expertise spanning mould design, automation, production,
assembly, and printing, Carclo supports critical growth sectors,
particularly life sciences, aerospace, and optics, with tailored, precision
solutions.

 

LEI: 21380078MEM399JPI956

 

Enquiries:

Carclo plc                             +44 (0) 20
8685 0500

Frank Doorenbosch - Chief Executive Officer

Ian Tichias - Chief Financial Officer

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