REG - Lords Group Trading - Trading Update and Notice of Final Results

Lords TradingAnnouncement

26/04/2022 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20220426:nRSZ2720Ja&default-theme=true

RNS Number : 2720J  Lords Group Trading PLC  26 April 2022

 For immediate release  26 April 2022

 

 

Lords Group Trading plc

('Lords' or the 'Group')

 

Trading Update

 

Notice of Final Results

 

Lords, a leading distributor of building materials in the UK, provides the
following trading update ahead of publication next month of the Group's full
year results for the year ended 31 December 2021 ('FY21' or the 'period').

 

The Group confirms that it expects to report FY21 revenues in line with market
expectations of £363 million and profitability in line with or exceeding
market expectations, with FY21 Adjusted EBITDA* of approximately £21.5
million and Adjusted EPS (basic)** of not less than 5.4 pence per ordinary
share.

 

In addition, the performance and integration of the seven businesses acquired
by Lords during FY21 and following the year end continue in line with
expectations.

 

Current trading and outlook

 

Including the benefit of acquisitions made prior to and during the period,
Group Q1 FY22 revenue was approximately 13.5% ahead of the same period last
year.

 

 Unaudited, £m           Q1 FY22 revenues  Q1 FY21 revenues  %        % Like-for-like growth

                                                             Growth
 Merchanting             £45.6             £25.4             79.3%    16.8%
 Heating & Plumbing      £57.7             £65.5             (12.0%)  (12.0%)
 Total Group             £103.2            £91.0             13.5%    (4.0%)

 

Since the year end, demand for the Group's repairs, maintenance and
improvement ('RMI') sector focused product offering has remained strong and,
notwithstanding inflationary pressures and the current global macro-economic
and geo-political outlook, the Group's Merchanting division has continued to
deliver growth in line with management expectations during Q1 FY22.

 

Strong Q1 FY22 Merchanting division like-for-like revenue growth of 16.8%
(over the same period in the prior year) has been driven by delivery of the
Group's organic strategy of product range extension, enhanced digital presence
and focus on exceptional customer service. Absolute Merchanting revenue growth
of 79.3% during the quarter (when compared to Q1 FY21) has been primarily
driven by ongoing delivery of the Group's stated acquisition strategy.

 

Customer demand has also remained strong across the Group's Heating and
Plumbing division ('H&P'). However, APP Wholesale Limited has not been
immune to industry wide boiler supply constraints on account of boiler
component shortages and the limited boiler supply has had a progressively
negative effect on the division's revenues throughout Q1 FY22, with Q1 H&P
FY22 division revenues approximately 12.0% below the same period last year.

 

Whilst the impact is expected to be felt more acutely in revenue terms in the
months of April and May 2022 as lower stock availability and supply
constraints persist, underlying customer demand remains strong and indications
are that the boiler supply issues will ease later in FY22.

 

Including the benefit of acquisitions made prior to and during the period, and
notwithstanding prevailing boiler supply constraints within the Group's
H&P division, the Group continues to trade largely in line with market
expectations for FY22 - with current expectations of FY22 Group revenue of
approximately £438 million and, as a result of management actions taken, FY22
profitability in line with current market expectation with Adjusted PBT* of
approximately £16.0 million.

 

Commenting on the trading update, Shanker Patel, Chief Executive Officer,
said: "We continue to make strategic acquisitions that are integrating well
into the Group and adding to our size, reach and product range, which helps to
better serve our customers and ultimately drive growth. While industry wide
boiler component shortages have created a short-term impact on our Heating and
Plumbing division, importantly customer demand remains robust, showing the
strength of our proposition."

 

Notice of Final Results

 

The Group will report its final results for the year ended 31 December 2021 on
Tuesday, 24 May 2022.  There will be a conference call for analysts at
0930hrs on the day of the results, which will be hosted by Shanker Patel (CEO)
and Chris Day (CFO).  Please contact Buchanan at LGT@buchanan.uk.com
(mailto:LGT@buchanan.uk.com) if you would like to receive details.

 

 

*Adjusted EBITDA is defined as earnings before interest, tax, depreciation and
amortisation, share option expense, acquisition costs and exceptional items,
and is stated on an IFRS basis.

 

**Adjusted PBT (basic) is defined as profits before tax before amortisation of
goodwill.

 

The information contained within this announcement is deemed by the Company to
constitute inside information pursuant to Article 7 of EU Regulation 596/2014
as it forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 as amended.  Upon the publication of this announcement
via a Regulatory Information Service, this inside information is now
considered to be in the public domain.

- Ends -

 

FOR FURTHER ENQUIRIES:

 

 Lords Group Trading plc                                                    Via Buchanan
 Shanker Patel, Chief Executive Officer                                     Tel: +44 (0) 20 7466 5000
 Chris Day, Chief Financial Officer

 Cenkos Securities plc (Nominated Adviser and Joint Broker)                 Tel: +44 (0)20 7397 8900
 Ben Jeynes / Max Gould / Dan Hodkinson (Corporate Finance)
 Alex Pollen (Sales)

 Berenberg (Joint Broker)                                                   Tel: +44 (0)20 3207 7800

 Matthew Armitt / Richard Bootle / Ciaran Walsh

 Buchanan Communications                                                    Tel: +44 (0) 20 7466 5000
 Henry Harrison-Topham / Stephanie Whitmore/ Kim Looringh-van Beeck / Kiki  LGT@buchanan.uk.com
 Norman

 

 

Notes to editors:

 

Lords is a specialist distributor of building, plumbing, heating and DIY
goods.  The Group principally sells to local tradesmen, small to medium sized
plumbing and heating merchants, construction companies and retails directly to
the general public.

 

The Group operates through the following two divisions:

 

·   Merchanting: supplies building materials and DIY goods through its
network of merchant businesses and online platform capabilities.  It operates
both in the 'light side' (building materials and timber) and 'heavy side'
(civils and landscaping), through 30 locations in the UK.

 

·    Heating and Plumbing: a specialist distributor in the UK of heating
and plumbing products to a UK network of independent merchants, installers and
the general public.  The division offers its customers an attractive
proposition through a multi-channel offering.  The division operates over 15
locations enabling nationwide next day delivery service.

 

Lords was established over 35 years ago as a family business with its first
retail unit in Gerrards Cross, Buckinghamshire.  Since then, the Group has
grown to a business operating from 45 sites.  Lords aims to become a £500
million turnover building materials distributor group by 2024 as it grows its
national presence.

 

Lords was admitted to trading on AIM in July 2021 with the ticker LORD.L.
For additional information please visit www.lordsgrouptradingplc.co.uk
(http://www.lordsgrouptradingplc.co.uk/)  .

 

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 (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTUVVNRUUUSUAR