REG - Sanderson Design Grp - Trading Update

Sanderson DesignAnnouncement

20/01/2025 07:00

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RNS Number : 9253T  Sanderson Design Group PLC  20 January 2025

 20 January 2025

SANDERSON DESIGN GROUP PLC

("Sanderson Design Group", the "Company" or the "Group")

 

Trading Update

 

Sanderson Design Group PLC (AIM: SDG), the luxury interior design and
furnishings group, announces a trading update for the financial year ending 31
January 2025.

The Group's half year results announced on 16 October 2024 stated that the
Board's expectations for the full year were reliant on a projected improvement
in the trading environment. The Board now expects Group sales for the year to
be approximately £101 million (FY24: £108.6m), a shortfall of less than 5%
to its earlier expectations, but the resultant sales mix will have a
significant impact on full year profitability.

Brand product sales for the year are expected to be down approximately 9%
compared with last year (FY24: £78.8m) after a recent worsening of trading
conditions. Brand sales of wallpapers and fabrics in our retail channel were
5% up in December 2024, compared with the same month in 2023, whereas sales in
the first two weeks of January are down 13% compared with the same time last
year, with the downturn in consumer confidence being most significant in the
UK, our largest market.

Subdued customer demand, particularly for fabric, is expected to result in a
greater than anticipated level of year-end stock provisioning although this
inventory is expected to unwind in the coming months. Softness in the contract
market at the end of the year, particularly in North America, has also
impacted Brand product sales although the pipeline of potential contract
orders remains strong.

Licensing has shown good momentum since the half year results and is expected
to end the year delivering revenue in the region of £10.1 million to £10.9
million (FY24: £10.9m), with the final outturn dependent on the timing of
signature of contracts in work.

In Manufacturing, third-party orders have reflected the challenging consumer
and industry environment. Expectations of an improved trading environment
towards the end of the year have not been realised, demand for higher-margin
repeat orders has recently declined and some customers are delaying planned
launches. Although there has been success in new business wins, this is for
smaller print runs of new designs which are at lower margins owing to initial
set up costs.

As a result of the factors outlined above the Board now expects underlying
pre-tax profits for the year ending 31 January 2025 to be in the region of
£4.0 million to £4.8 million.

The Group benefits from a robust balance sheet and continues to focus on cash
generation. Net cash at 31 January 2025 is expected to be approximately £5
million (H1 FY25: £9.6m; FY24: £16.3m), reflecting the one-off £2.3 million
pension contribution in June 2024, one-off capital expenditure items of
approximately £3 million and slightly increased inventory levels. Net cash is
expected to build in the first half of the new financial year.  In addition,
the Group has a committed undrawn £10 million revolving credit facility and
uncommitted £7.5 million accordion.

The Group is continuing to accelerate strategic changes and focusing on
efficiency and cost savings to better position the business for the current
trading environment and for future growth. The Group benefits from a strong
portfolio of brands, a valuable archive and exciting upcoming product
launches. The Board remains confident in the Group's future performance once
trading conditions improve.

The Group expects to announce its results for the financial year ending 31
January 2025 in April 2025.

 

This announcement contains inside information for the purposes of UK MAR.
The person responsible for arranging the release of this announcement on
behalf of the Company is Mike Woodcock, Chief Financial Officer.

 

 

For further information:

 Sanderson Design Group PLC                                   c/o Buchanan +44 (0) 20 7466 5000
 Lisa Montague, Chief Executive Officer
 Mike Woodcock, Chief Financial Officer

 Investec Bank plc (Nominated Adviser and Joint Broker)       +44 (0) 20 7597 5970
 David Anderson / Ben Farrow / Charlotte Young

 Singer Capital Markets (Joint Broker)                        +44 (0) 20 7496 3000
 Tom Salvesen / Jen Boorer / James Todd

 Burson Buchanan                                              +44 (0) 20 7466 5000
 Mark Court / Sophie Wills / Toto Berger / Abigail Gilchrist
 SDG@buchanan.uk.com (mailto:SDG@buchanan.uk.com)

 

Notes for editors:

About Sanderson Design Group

Sanderson Design Group PLC is a luxury interior furnishings company that
designs, manufactures and markets wallpapers, fabrics and paints. In addition,
the Company derives licensing income from the use of its designs on a wide
range of products such as bed and bath collections, rugs, blinds and
tableware.

Sanderson Design Group's brands include Zoffany, Sanderson, Morris & Co.,
Harlequin, Clarke & Clarke and Scion.

The Company has a strong UK manufacturing base comprising Anstey wallpaper
factory in Loughborough and Standfast & Barracks, a fabric printing
factory, in Lancaster. Both sites manufacture for the Company and for other
wallpaper and fabric brands.

Sanderson Design Group employs approximately 580 people and its products are
sold worldwide. It has showrooms in London, New York and Chicago.

Sanderson Design Group trades on the AIM market of the London Stock Exchange
under the ticker symbol SDG.

For further information please visit: www.sandersondesigngroup.com
(http://www.sandersondesigngroup.com)

 

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