REG - Eurocell plc - Trading Update

EurocellAnnouncement

11/12/2019 07:05

RNS Number : 4378W
Eurocell plc
11 December 2019
 


11 December 2019
 
EUROCELL PLC
(Symbol: ECEL)
 
Trading Update
 
Eurocell(1) provides this update for the 11 months to 30 November 2019.
 
Trading and Operational Performance
We have continued to take market share and deliver a good sales performance in the second half of the year, albeit against strong 2018 comparatives. Revenue for the 11 months to 30 November 2019 is up 7% on a like-for-like basis(2).  
·    Profiles division - like-for-like growth of 5% includes good contributions from both existing and new accounts from across our fabricator base.
·    Building Plastics - like-for-like growth of 8% reflects the positive impact of better stock availability and our new management team driving improvements in operating standards.
 
Gross margin is ahead of last year, reflecting higher usage of recycled material and selling price increases implemented progressively across the business in the first half to recover cost inflation.
 
We continue to incur some operating inefficiencies. However, as previously announced, Mark Hemming joined the business as Chief Operating Officer in August. Mark has made an excellent start and is now leading our drive to improve operating efficiency, focused initially in the following areas:
·    The capex programme launched at the beginning of the year to improve manufacturing efficiency and increase co-extrusion and foam capacity by 30% and 15% respectively is now complete. All the new lines are fully operational and working well.
·    As described at the half year, we have suffered some delays with our project to expand recycling capacity at Ecoplas. However, the programme is now well advanced and performance is improving.
·    We have continued to incur additional warehousing and distribution costs, particularly through the peak period, including the impact of a change in transport provider in September when the previous contract expired. We are reviewing options to expand our warehousing capacity.  
 
As previously reported, we have invested in a stock build programme to mitigate the possible impact of raw material supply interruption due to Brexit, and to increase stock holding at our branches. We have added approximately £5 million to finished goods for key product lines under the plan, which provides a good level of protection and much improved availability.
 
Taken together, these factors underpin our current expectations for full year earnings.  
 
Notice of Results
We will announce our preliminary results for the year ending 31 December 2019 on 13 March 2020.
 
 
~~~~~~~~~~~~~~~~~~~~~~~
 
 
Notes:
(1)   Eurocell plc is a market leading, vertically integrated UK manufacturer, recycler and distributor of innovative window, door and roofline PVC products.
(2)   Like-for-like sales exclude acquisitions and branches opened in 2018/19.
 
 
Enquiries:
Eurocell plc
Mark Kelly, Chief Executive Officer
+44 (0) 1773 842 105
 
Michael Scott, Chief Financial Officer
+44 (0) 1773 842 140  
 
Teneo
Ben Foster
+44 (0) 20 3603 5221
 
Camilla Cunningham
+44 (0) 20 3757 9235
 
eurocell@teneo.com
 
END




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 or visit www.rns.com.
 
END
 
 
TSTKMMMZFGGGLZZ