REG - Epwin Group PLC - Year-end trading update and notice of results

EpwinAnnouncement

21/01/2025 07:00

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RNS Number : 0304U  Epwin Group PLC  21 January 2025

21 January 2025

 

Epwin Group Plc

("Epwin", the "Company" or the "Group")

 

Year-end trading update and notice of results

 

 Underlying operating profit expected to be marginally ahead of market
expectations

 

Epwin Group Plc (AIM: EPWN), the leading manufacturer of energy efficient and
low maintenance building products, with significant market shares, supplying
the Repair, Maintenance and Improvement ("RMI"), new build and social housing
sectors, is pleased to announce its year-end trading update in respect of the
year ended 31 December 2024 ("FY 2024").

 

Resilient trading performance in FY 2024

 

Trading remained resilient through to the end of the year, despite the
macroeconomic and fiscal challenges. The Group has continued to responsibly
balance its volume and margin, whilst maintaining a sharp focus on operational
efficiency; together this has continued to improve operating margins. As a
result, the Group expects to report underlying operating profit for FY 2024
marginally ahead of current market expectations(1) and also ahead of the prior
year.

 

Revenues for the year were in line with market expectations(1), however, H2
saw an improving trend and since the start of September monthly revenues have
encouragingly all been slightly ahead of their respective 2023 comparatives.

 

The Group has continued to make good progress with its strategy. There have
been further improvements in operational leverage and efficiency, as well as
bolt-on acquisitions which have expanded our trade counter network and our GRP
moulding business.  New product development has continued alongside the
Group's sustainability initiatives, focusing on production optimisation and
efficiency. The successful rollout of the new IT system in our Distribution
business is beginning to deliver benefits to the business.

 

Strong cash generation boosting shareholder returns

 

Cash generation has remained strong and the Group expects to report covenant
net debt (pre-IFRS 16) at 31 December 2024 of c. £15.5
million (2023: £14.4 million), an improvement compared to current market
expectations(1). This represents year-end leverage of less than 0.5x adjusted
EBITDA.

This year-end net debt position was delivered after returning a total of
£14.1 million to shareholders including paying out £6.9 million in ordinary
dividends and an additional £7.2 million returned to shareholders through the
continuing share buyback programme. We also invested £2.9 million in the
bolt-on acquisitions.

 Confident outlook for both FY 2025 and the medium-term

 

The Group expects to make further strategic and financial progress in 2025,
despite the ongoing current macroeconomic and fiscal conditions which are
expected to continue to temper demand in our markets in the first half of
2025.

 

The increases to Employers' National Insurance and the National Living Wage
announced by the Government in the Budget in October 2024 will cost the Group
an annualised c.£3 million, before taking account of any impact on other pay
thresholds. The Group is confident in its ability to manage these additional
unforeseen costs by making adjustments to its operational footprint and
through pricing, in order to meet existing market forecast expectations.

 

Near-term, the Group remains focused on continuing to manage the balance
between volume and margin, maintaining service levels and driving further
operational improvements.  With on-going strategic progress, the Board is
confident in the Group's position and in the strength of the medium and
long-term demand from its markets.

 

Notice of results

 

The Group will announce its full year results for the year to 31 December 2024
on Wednesday 9 April 2025.

 

Jon Bednall, Chief Executive Officer, said:

"For a fourth consecutive year, the Group has delivered improved financial
performance, meeting or exceeding market expectations despite a challenging
market backdrop. This year has again demonstrated the resilience of the
Group's strategy and operating model, as well as the dedication and expertise
of all of my Epwin colleagues. Once again I thank them for rising to the
challenge and for the good progress we have continued to make."

"We remain confident in the Group's future prospects and expect to make
further progress this year, despite the ongoing macroeconomic and fiscal
headwinds."

 

Notes

((1)) Based on Company compiled consensus, the Board believes the average
analyst forecast for 2024 revenues to be £325.8 million, underlying operating
profit to be £25.8 million and covenant net debt (pre-IFRS 16) to
be £16.3 million.

 

Ends.

Contact information

 Epwin Group Plc                                      07885 447944

 Jon Bednall, Chief Executive

 Chris Empson, Group Finance Director

 Shore Capital (Nominated Adviser and Joint Broker)   0207 408 4090

 Corporate Advisory

 Daniel Bush / Harry Davies-Ball

 Corporate Broking

 Fiona Conroy

 Zeus Capital Limited (Joint Broker)                 0203 829 5000

 Dominic King / Nick Searle

 MHP                                                  07885 447944

 Reg Hoare / Matthew Taylor / Finn Taylor            epwin@mhpgroup.com (mailto:epwin@mhpgroup.com)

 

 

About Epwin

Epwin is the leading manufacturer of energy efficient and low maintenance
building products, with significant market shares, supplying the Repair,
Maintenance and Improvement ("RMI"), new build and social housing sectors.

 

The Company is incorporated, domiciled and operates principally in the United
Kingdom.

 

Information for investors can be accessed www.epwin.co.uk/investors/
(https://protect.checkpoint.com/v2/r06/___http:/www.epwin.co.uk/nsAjxytwxd___.ZXV3MjpuZXh0MTU6YzpvOmZjOGNmZmY5YjZmNDcyZDlmMTdkNWUwMGQwYzdkMzMwOjc6YTYwNDo0M2FlYjdlMjE3ZGMyMDAyNzQ4MzUyZjMwYjdhMWZhMzUyMzBmYjM3MWE0MmZiYTk5YjRhNjA0YzQ0YTFkZDE5OnA6VDpU)

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