REG - Portmeirion Group - FY23 Trading Update

PortmeirionAnnouncement

17/01/2024 07:00

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RNS Number : 9139Z  Portmeirion Group PLC  17 January 2024

17 January 2024

 

PORTMEIRION GROUP PLC

('the Group')

 

FY23 Trading update

 

Good Christmas trading period and full year performance in line with market
expectations

 

Portmeirion Group PLC, the owner, designer, manufacturer and omni-channel
retailer of leading homeware brands in global markets, provides an update on
its trading for the year ended 31 December 2023.

 

FY23 performance

 

We are pleased to report a good Christmas trading period with robust demand
across our portfolio of consumer goods brands. As a result, FY23 sales are now
expected to be at least £102 million, marginally ahead of consensus market
expectations. This is 10% above pre-Covid 2019 levels but lower than FY22's
record results as anticipated. We expect FY23 profit before taxation to be in
line with underlying consensus market expectations.

 

Sales in North America and South Korea were down year on year due to the
impact of weaker consumer sentiment and de-stocking by our major retail
customers. However, we are encouraged by stronger consumer demand through Q4
for our key Christmas ranges. Sales from our Spode brand continued to grow,
with Spode Christmas Tree sales again increasing, driven by both additional
store space and extensions to the range.

 

Our UK ceramic sales were flat YOY but we saw a strong seasonal trading
period, particularly from our ecommerce orders, which were up 9% for the final
eight weeks of FY23 compared to the prior year.

 

Ceramic sales in our rest of world markets (ROW), a key strategic growth area,
were up 13% YOY and sales in Wax Lyrical, our home fragrance division, were up
24% YOY driven by new listing wins in the UK grocery channel and the full year
impact from the acquisition of the AromaWorks London brand.

 

Following our focus on reducing inventory we are pleased to have seen a
reduction YOY in both net debt and inventory as at the year end.

 

FY24 Outlook

 

Following a positive Christmas performance, we expect sales to return to
growth in 2024 YOY alongside a healthy operating margin improvement compared
to 2023. However, we expect 2024 to be a challenging year due to ongoing
macro uncertainty with customers remaining cautious in relation to H1 order
flow, in particular in the US and Korean markets. In addition, we expect to
continue to incur higher interest costs during the year given current rates.

 

Mike Raybould, Chief Executive, commented:

 

"Although consumer market conditions have been significantly more challenging
in 2023, we are encouraged by our strong Christmas trading performance in the
UK and US, the continued growth in our ROW markets and the sales rebound and
new business wins in our home fragrance division.

 

We are excited about the opportunity to further expand our customer base, both
within our core markets but also through leveraging our well-known brands
across ROW markets. Within our key US market, we are delighted to be opening
a new enlarged permanent showroom this week at the 2024 Atlanta Gift Show.
This exciting new space will showcase new product introductions across our
brand portfolio to national, regional, and independent retailers from across
the US and Canada.

 

Whilst we expect market conditions to remain challenging in the first half of
2024, particularly in the US and South Korea, we expect to see growth across
the full year and we are confident in our long-term strategic progress and the
market share gains we are making."

 

The Company expects to announce preliminary results for the year ended 31
December 2023 in late March 2024.

 

Notes:   This announcement contains inside information for the purposes of
the retained UK version of the EU Market Abuse Regulation (EU) 596/2014 ("UK
MAR").

 

 Portmeirion Group PLC:
 Mike Raybould, Chief Executive          +44 (0) 1782 743 443   mraybould@portmeiriongroup.com
 David Sproston, Group Finance Director  +44 (0) 1782 743 443   dsproston@portmeiriongroup.com

 Hudson Sandler:
 Dan de Belder                           +44 (0) 207 796 4133   portmeirion@hudsonsandler.com
 Nick Moore

 Emily Brooker

 Shore Capital:                          +44 (0) 207 408 4090

 (Nominated Adviser and Joint Broker):
 Patrick Castle                          Corporate Advisory

 Lucy Bowden
 Malachy McEntyre                        Corporate Broking

 Isobel Jones

 

 Singer Capital Markets

 (Joint Broker):         +44 (0) 207 496 3000
 Peter Steel             Investment Banking
 Asha Chotai

 

NOTES TO EDITOR:

Portmeirion Group PLC is a leading, omni-channel British ceramics manufacturer
and retailer of leading homeware brands.

 

Based in Stoke-on-Trent, United Kingdom, the Group owns six unrivalled
heritage and contemporary brands, with 750+ years of collective heritage;
Portmeirion, Spode, Royal Worcester, Pimpernel, Wax Lyrical and Nambé.

 

The Group serves markets across the world, with global demand driven by
diversified international markets including the key geographies of the US, UK
and South Korea.

 

Portmeirion Group has a proven capital-light, well developed and self-funded
growth strategy focused on building a wider customer base and growing the
sales footprint of its brands, through:

·    Building and growing international sales markets

·    Developing online sales channels in core markets

·    Designing and launching new product to widen appeal and take market
share

·    Leveraging brands and extensive product ranges

 

 

 

 

 

 

 

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