REG - Genuit Group PLC - Trading Update

GenuitAnnouncement

25/10/2022 07:00

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RNS Number : 9471D  Genuit Group PLC  25 October 2022

Genuit Group plc

Trading Update
__________________________________________________________________________________

 

25 October 2022

 

Genuit Group plc ("Genuit", the "Company" or the "Group"), a leading provider
of sustainable water, climate and ventilation products for the built
environment, today issues an update on trading for the nine months ended 30
September 2022.

 

Group revenue for the nine months ended 30 September 2022 was £472 million
(2021: £451 million) representing growth of 4.7% on a strong comparative
period. On a like-for-like basis, Group revenue growth was 3.0%.

 

·    For the nine months, Residential sales were £297 million up 6.2%
(4.8% on a like-for-like basis) on the prior year and Commercial &
Infrastructure sales were £176 million up 2.3% (0.4% on a like-for-like
basis) over the same period.

 

·    Against a backdrop of increased macro-economic and political
uncertainty, the Group has experienced tougher trading conditions over recent
weeks and has not seen the normal seasonal uplift in volumes in the latter
part of Q3. This has impacted most parts of the business, and in particular
RMI, although the areas that are driven by the need for energy efficiency are
trading well.

 

·    The Group continues to proactively counter ongoing cost inflation
through robust price leadership and a successful September price increase has
been implemented in parts of our business to deal with these continued
pressures.  Measures, including a planned restructuring, are also actively
being taken to improve the efficiency of our operations and these will deliver
approximately £8 million of savings on an annualised basis.

 

·    Supply chain issues persist and the constraint in the supply of
semiconductors and printed circuit boards in the upstream boiler market
remain, inhibiting customer demand. We remain vigilant that further challenges
to our supply chain such as the constraint in the supply of blowers to our
Climate & Ventilation division are proactively mitigated to the greatest
possible extent.

·    The Group remains highly cash generative and net debt has reduced
since the half year. We anticipate that capital expenditure for the full year
will be approximately £40 million and the Group expects to report pre-IFRS16
net debt to EBITDA of circa 1.2x at the year end, reduced from 1.5x at 30 June
2022.

 

·    As a consequence of the uncertainty impacting trading in the latter
part of Q3, the Board now expects profit for the year to be at the lower end
of analyst expectations*.

 

Joe Vorih, Chief Executive Officer, commented:

"The overall trading environment remains challenging, and we are seeing some
slowing in line with pressures on the sector.   RMI is particularly
impacted, though some bright spots remain, including conversion to renewable
heating and improvement to existing heating system efficiency.  The Group is
well positioned to weather this uncertainty, with variable manufacturing
capacity and we have already undertaken significant self-help measures with
planned improvements to our cost structure.    The medium- and long-term
fundamentals of the Group are strong, as legislative growth drivers, customer
commitments to Net Zero, and the climate-driven need for low-carbon heating
solutions, improved building ventilation, and resilient stormwater management
all play to Genuit's strengths."

 

Capital Markets Day

The Group will hold an in-person Capital Markets Day for investors and
analysts on Thursday 10 November 2022 at the Group's Adey business in
Gloucestershire.

 

Full Year Results

Full year results for the year ending 31 December 2022 will be announced on 14
March 2023.

 

* Genuit compiled analyst consensus forecast range for 2022 shows EBIT of
£96.8 - £109.0 million.

 

Enquiries:

 

Genuit
 
+44 (0) 113 831 5315

 

Joe Vorih, Chief Executive Officer

Paul James, Chief Financial Officer

 

Brunswick
 
+44 (0) 2074 045 959

 

Nina Coad

Tom Piggot

 

Notes to Editors:

Genuit Group plc ("Genuit" or the "Group"), a leading provider of sustainable
water and climate management solutions for the built environment, is the
largest manufacturer in the UK, and among the ten largest manufacturers in
Europe, of piping systems for the residential, commercial, civils and
infrastructure sectors by revenue. It is also a leading designer and
manufacturer of energy efficient ventilation systems in the UK.

The Group operates from 30 facilities in total and manufactures the UK's
widest range of solutions for heating, plumbing, drainage and ventilation. The
Group primarily targets the UK and European building and construction markets
with a presence in Italy, the Netherlands and the Middle East and sales to
specific niches in the rest of the world.

Genuit Group plc changed its corporate name from Polypipe Group plc on 6 April
2021. The Group was established in 1980 and has been listed on the London
Stock Exchange since 2014.

 

END

 

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