REG - McBride PLC - Financial Year 2022 trading update

McBrideAnnouncement

19/08/2021 07:00

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RNS Number : 1016J  McBride PLC  19 August 2021

19 August 2021

 

McBride plc

 

Financial Year 2022 trading update

 

McBride plc (the "Group"), the leading European manufacturer and supplier of
private label and contract manufactured products for the domestic household
and professional cleaning and hygiene markets, today provides a trading update
for the current financial year ending 30 June 2022.

 

On 14 July 2021, as a result of both the uncertainty surrounding the volatile
input cost environment and the success and timing of pricing actions, the
Board indicated that, at that time, it would not be offering guidance on the
outlook for financial year 2022.

 

Although only 7 weeks into the new financial year, the previously highlighted
raw material environment remains extremely challenging both in terms of
exceptional price increases and supply availability. More recently, and in
line with the general trading environment experienced by others, the Group has
also started to experience distribution challenges, particularly in the UK and
Germany as a result of the shortage of Heavy Goods Vehicle (HGV) drivers which
has impacted upon both transport availability and cost.

 

Also as previously indicated, the Group continues to discuss margin recovery
actions with its customers, mostly across liquids categories.  McBride's
approach has been to seek a variable pricing surcharge to sales contracts,
based upon certain key commodity prices.

 

The Board's view on input costs for the new financial year remains in line
with prior estimates.  In terms of customer pricing, although discussions
have resulted in agreement for price increases, the effective start dates for
price increases are later than targeted.

 

The first half of FY22 is now expected to see EBITA at approximately
break-even, with profits therefore heavily weighted towards the second half of
the year, with the business exiting the year with run-rate profit levels in
line with the average of the last few years.

 

As a consequence, the Board expects adjusted profit before tax for financial
year 2022 to be 55% - 65% lower than current market consensus (*) for full
year 2021, and for net debt at 30 June 2022 to be 5%-10% higher than full year
2021 consensus (*).

 

The short-term challenges facing the business have no effect on the ongoing
execution of the Group's Compass strategy as outlined at its capital markets
day in February 2021, nor its mid-term ambitions.

The Group continues to operate within its banking covenants and the Group's
liquidity and cash flow remain robust.

 

A further update will be provided at the Group's preliminary results
presentation for the year ended 30 June 2021 on 7 September 2021.

 

 

 

* Current market expectations for full year 2021 refer to a group compiled
consensus for FY21 of an adjusted PBT of £19.7m, and a Net debt including
IFRS 16 of £121.5m

For further information, please contact:

 

McBride plc

Chris Smith, Chief Executive
Officer                         0161 203 7570

Mark Strickland, Chief Finance Officer
0161 203 7570

 

FTI Consulting
 
020 3727 1017

Ed Bridges, Nick Hasell

 

 

This announcement contains inside information which is disclosed in accordance
with the Market Abuse Regulation which came into effect on 3 July 2016.

 

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