REG - LPA Group PLC - Product Line Acquisition

LPAAnnouncement

27/03/2023 07:00

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RNS Number : 2281U  LPA Group PLC  27 March 2023

LPA GROUP PLC

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

Product Line Acquisition

LPA Group plc, the high reliability LED lighting, electronic and
electro-mechanical system designer and manufacturer, is pleased to announce
the conditional purchase of a product line from Amphenol Limited ("Amphenol")
(the "Acquisition"). The product line is Amphenol's UK historic range of
railway inter-carriage electrical connectors (inter-car jumpers),
complementing LPA Connection Systems' existing product range.

The Acquisition, effective 24 March 2023, replaces a ten year licensing
agreement between LPA and Amphenol, signed in May 2021, whereby LPA undertook
the manufacture and supply of Amphenol connectors to the UK rail aftermarket
customer base, and the profits from the product line were shared on a 50:50
basis between the two parties.

The Acquisition enables LPA to continue to manufacture and supply the railway
inter-carriage electrical connectors direct to the customer, and now retaining
all associated profits.

Paul Curtis, CEO, commented: "This is an excellent agreement for all parties,
assisting both in their strategies of development and growth for the coming
years. The aftercare market is a key focus for LPA and these products provide
access to nearly 3,000 existing vehicles, to which we can offer our excellent
levels of quality and support over the coming decade. This product line will
support the Group's delivery of FY23 results in line with existing Board
expectations."

The Acquisition, now agreed and signed, is conditional on formal approval from
our customer. The terms of the Acquisition have been discussed with the
customer, no problems are envisaged, and formal approval is expected to be
obtained within the coming weeks.

The revenue for this product line for the year ended 30 September 2022 was
£388,000, with a total PBT of £115,000 split between the two parties. LPA is
acquiring all product line intellectual property and tooling. Consideration
paid for the Acquisition is £500,000 satisfied in cash from existing cash
resources. As at 28 February 2023, LPA had cash of approximately £1.6m
(unaudited) and bank debt of £2.1m (unaudited).

 

 

 Enquires:                           www.lpa-group.com      Tel:

 LPA Group plc                                              01799 512 800
 Robert B Horvath                    Chairman
 Paul Curtis                         CEO

 Stuart Stanyard                     CFO

 finnCap                             NOMAD and Broker       020 7220 0500
 Ed Frisby / Abigail Kelly

 (Corporate Finance)

 Tim Redfern / Charlotte Sutcliffe

 (ECM)

 

 

About LPA

LPA Group plc (AIM: LPA) is a market leading designer, manufacturer and
supplier of high reliability LED lighting, electronic and electro-mechanical
systems, and a distributor of engineered components.

Focused on transport (rail and aviation), defence, infrastructure and
industrial markets and supplying into hostile and challenging environments,
LPA is known for engineering solutions to improve product reliability,
reducing maintenance and life cycle costs.

The Group has three sites across the UK, selling to customers in the UK and
overseas. Two of these are design and manufacturing sites: LPA Connection
Systems - electro-mechanical systems for rail, aviation and industrial, and
LPA Lighting Systems - LED lighting and electronic systems for rail and
infrastructure. The third site is LPA Channel Electric - a value added
distributer of engineered components for rail, aerospace and defence.

With over 160 years of UK design and manufacture, and with origins in the
first ever light installed in 'Electric Avenue', Brixton; innovation is core
to LPA and to the products and services supplied to our customers worldwide.

For more information visit www.lpa-group.com (http://www.lpa-group.com/)

 

The information contained within this announcement is deemed to constitute
inside information as stipulated under the Market Abuse Regulations (EU No.
596/2014) which is part of UK law by virtue of the European Union (Withdrawal)
Act 2018. Upon the publication of this announcement, this inside information
is now considered to be in the public domain.

Caution regarding forward looking statements

Certain statements in this announcement, are, or may be deemed to be, forward
looking statements. Forward looking statements are identified by their use of
terms and phrases such as ''believe'', ''could'', "should" ''envisage'',
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''will'' or the negative of those, variations or comparable expressions,
including references to assumptions. These forward looking statements are not
based on historical facts but rather on the Directors' current expectations
and assumptions regarding the Company's future growth, results of operations,
performance, future capital and other expenditures (including the amount,
nature and sources of funding thereof), competitive advantages, business
prospects and opportunities. Such forward looking statements reflect the
Directors' current beliefs and assumptions and are based on information
currently available to the Directors.

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