REG - Mpac Group PLC - Trading Update and Notice of Results

MPACAnnouncement

11/07/2023 07:00

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RNS Number : 5603F  Mpac Group PLC  11 July 2023

11 July 2023

 

This announcement contains inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 which is part of UK law by virtue of
the European Union (Withdrawal) Act 2018

 

Mpac Group plc

(''Mpac'' or the "Group")

Trading update and notice of results

 

Mpac Group plc, a global leader in high-speed packaging and automation
solutions, issues a trading update ahead of the release of its unaudited
results for the six months ended 30 June 2023.

 

Trading in the first half was in line with the Board's expectations.  As
communicated in the AGM statement in May and as further detailed below, we
expect the full year financial performance to be weighted towards the second
half of the year.  The strength of the order book and nature of projects for
delivery supports the Board's full year expectations, which remain unchanged.

 

The performance of our recurring, higher margin Service business has been
strong, benefiting from enhanced engagement and an improved service model for
our customers.  On-site commissioning of the CQP assembly line for FREYR
Battery has commenced and is ongoing.  As anticipated, Original Equipment
margins in the period were impacted by the completion of projects which had
been affected by supply chain disruption in 2022.  The effects of this are
now largely cleared and accordingly, second half trading is anticipated at
normalised margins, which gives confidence to the second half weighting.

 

Year to date order intake of £62.4m is significantly ahead of the prior year
(H1 2022: £32.8m) and the June 2023 closing order book of £78.4m is above
the 2023 opening order book of £67.2m.

 

Mpac has a strong balance sheet, with the expansion of working capital in 2022
unwinding in line with expectations and the Group closed the half year with
positive net cash.

 

Beyond the short-term economic challenges, the outlook for the business
remains positive.  We carry forward a strong prospect pipeline and order
book, concentrated on companies in our core, resilient, end markets of
Healthcare and Food and Beverage and with a balance sheet which provides us
with the ability to invest in the Group for growth over the medium term and
beyond.  The Group remains focused on executing its long-term strategy of
delivering OE and Service growth at improved margins.

Adam Holland, Chief Executive, commented:

 

''I am delighted to provide my first update as Chief Executive.  I am pleased
to be able to report significant momentum in the first half of 2023 with
increase in Original Equipment and Service order intake and a closing H1 order
book of £78.4m, up significantly on the prior year.  In addition, the prior
year expansion of working capital has unwound in line with expectations, and
we close H1 in a positive net cash position.  We have a lot to do in the
second half but are anticipating normalised margins in the period and are
focused on delivering the strong order book for our customers.  We have made
good progress in strengthening the leadership team and I am confident that
Mpac has the employee skillset to take advantage of the attractive markets in
which we operate and deliver on our strategic objectives.''

The Group expects to announce its unaudited results for the six months ended
30 June 2023 on 7 September 2023.

 

For further information, please contact:

 Mpac Group plc                                  Tel: +44(0)24 7642 1100

 Adam Holland, Chief Executive

 Will Wilkins, Group Finance Director
 Shore Capital (Nominated Adviser & Broker)      Tel: +44(0)20 7408 4050

 Advisory

 Patrick Castle

 Iain Sexton

 Broking

 Henry Willcocks

 Hudson Sandler                                  Tel: +44(0)20 7796 4133

 Nick Lyon

 Nick Moore

 

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