REG - Inspecs Group PLC - Trading Update and Board Changes

InspecsAnnouncement

27/10/2022 07:01

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RNS Number : 2536E  Inspecs Group PLC  27 October 2022

27 October 2022

 

Inspecs Group plc

 

("Inspecs" or "the Group")

 

Trading Update and Board Changes

 

Inspecs Group plc, a global eyewear and lens design house and manufacturer,
today announces a trading update for the 9 months to 30 September 2022 (the
"Period") and provides a full year outlook.

On a constant currency basis, the Group has seen sales growth across Europe,
UK and the US during the Period, as well as in the Group's manufacturing
businesses in Vietnam and China. As set out in the Group's Interim Results,
this growth has been impacted by unfavourable foreign exchange movements,
particularly with the Euro weakening against the US dollar. Revenue for the
Period in both reported and constant currency is set out below:

 

 Revenue: reported currency         9 months to  9 months to   Change

 US$m                               30-Sept-22   30-Sept-21
 Group                              179.4        185.0        -3.0%
 Acquisitions during December 2021  10.8         -            -
 Total                              190.2        185.0        +2.8%

 

 

 Revenue: constant currency(1):     9 months to  9 months to  Change

 US$m                               30-Sept-22   30-Sept-21
 Group                              191.8        185.0        +3.7%
 Acquisitions during December 2021  11.2         -            -
 Total                              203.0        185.0        +9.8%

 

 1  Constant exchange rates: figures at constant exchange rates have been
    calculated using the average exchange rates in effect for the relevant
    comparative period.

 

In Europe, in particular Germany, both the macro-economic climate and consumer
confidence have deteriorated sharply since September 2022. German consumer
confidence is now at a 25-year low and this is reflected in the order intake
that is significantly down on the previous year. The Group's expectation is
that the German and French markets will remain weak into the first half of
2023.

 

In the US, the order book remains at a similar level to the prior year whilst
in the UK, the Group's frame business has shown growth on the previous year.
The Group's Vietnamese and Chinese manufacturing business, which is affected
by the European market, has seen a decrease in its order book. Overall, the
Group order book is down 13% at 30-Sept-22 on the previous year.

 

Due to the reduced order book, the Board has decided to delay the expansion of
the existing Vietnamese factory and the investment in a new factory in
Portugal until at least Q3 2023.

 

As set out in the Group's Interim Results, it took longer than expected to
complete Norville's new state-of-the-art manufacturing facility, but the
investment is still expected to deliver a return in 2023. The factory is
working with the Group's "Skunk Works" to continue developing ground breaking
lens technology for smart eyewear, along with other revolutionary lens-related
projects.

 

 

Board changes and finance function

 

Lord MacLaurin has notified the Board of his intention to retire as Chairman
on 1 December 2022. His contribution throughout his tenure has been invaluable
to the Group. As a result, Robin Totterman, CEO and founder of Inspecs, will
move to an Executive Chairman role from 1 December 2022. Simultaneously,
Richard Peck, current non-executive Director, and previously MD of Luxottica
Retail northern Europe and MD of David Clulow, will become the Group's Chief
Executive Officer.

 

The Board is currently in advanced stages of the take on process to appoint
two new additional non-executive directors to the Board, and an update will be
provided in due course.

 

With regards the Group's finance function, Inspecs is pleased to announce that
Matthew Loran will join the Group as its new Group Finance Manager in November
2022. Matthew previously worked for Capita Group plc and Imperial Brands plc,
working with the divisional finance teams around the globe. His experience
will assist the Group as it continues to expand and integrate its accounting
functions. In addition, new accounting personal have been recruited in both
the Group's German and USA subsidiaries to enhance reporting and controls.

 

Outlook

 

It is clear that Inspecs is not immune to the macro environment or the
downturn in consumer confidence, particularly in Europe, and this is expected
to impact the remainder of this year and into the first half of 2023. That
said, Inspecs continues to increase its market share and the Group is well
placed to return to growth as and when its core markets return.

 

The Board will provide a Full Year trading update in January 2023 when it will
look to give further guidance on the outturn for 2022 and the year ahead.

 

 

For further information please contact:

 

 Inspecs Group plc                         via FTI Consulting

 Robin Totterman (CEO)                     Tel: +44 (0) 20 3727 1000

 Chris Kay (CFO)

 Peel Hunt (Nominated Adviser and Broker)  Tel: +44 (0) 20 7418 8900

 Adrian Trimmings

 Andrew Clark

 Lalit Bose

 FTI Consulting (Financial PR)             Tel: +44 (0) 20 3727 1000

 Alex Beagley

 Harriet Jackson

 Alice Newlyn

This announcement contains inside information for the purposes of the Market
Abuse Regulation (Regulation (EU) No 596/2014) including as it forms part of
domestic law in the United Kingdom by virtue of the European Union
(Withdrawal) Act 2018. The person responsible for arranging release of this
announcement on behalf of Inspecs is Chris Kay, Chief Financial Officer.

 

 

About Inspecs Group plc

 

INSPECS is a Bath-based designer, manufacturer and distributor of eyewear
frames and optically advanced spectacle lenses. The Group produces a broad
range of frames and lenses, covering optical, sunglasses and safety, which are
either "Branded" (either under licence or under the Group's own proprietary
brands), or "OEM" (including private label on behalf of retail customers as
well as unbranded).

 

INSPECS aims to be the leader in eyewear solutions through its
vertically-integrated business model and has adopted a three-pillar growth
strategy to achieve this: (i) continue to grow organically; (ii) undertake
further acquisitions (and drive value through leveraging the Group's internal
capabilities); and (iii) extend the Group's manufacturing capacity.

 

The Group has completed several significant acquisitions since its IPO in
February 2020. In December 2020, INSPECS acquired Eschenbach, a leading global
eyewear supplier, headquartered in Nuremberg, Germany, which includes the
American company Tura. This followed the acquisition of lens maker Norville in
July 2020, whereby INSPECS combined two British heritage brands, Savile Row
frame maker, and Norville lens maker, further enhancing its
vertically-integrated business model. In December 2021 the Group acquired Ego
Eyewear, a design and licensing company which uses third party eyewear
manufacturers to produce premium fashion brands, and BoDe, a distributor of
optical frames and sunglasses principally to the German and neighbouring
markets.

INSPECS customers include global optical and non-optical retailers, global
distributors and independent opticians, with its distribution network covering
over 80 countries and reaching approximately 75,000 points of sale.

INSPECS has operations across the globe: with offices and subsidiaries in the
UK, Germany, Portugal, Scandinavia, the US and China (including Hong Kong,
Macau and Shenzhen), and manufacturing facilities in Vietnam, China, the UK
and Italy. With the acquisition of Eschenbach, the Group's international reach
further extends across Europe and the American markets.

More information is available at: https://inspecs.com (https://inspecs.com)
 

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