REG - Strip Tinning Hldgs - Trading and Business Update

Strip Tinning HoldingsAnnouncement

01/04/2025 07:15

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RNS Number : 0254D  Strip Tinning Holdings PLC  01 April 2025

1 April 2025

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the Company's obligations under Article 17 of
MAR. Upon the publication of this announcement via a Regulatory Information
Service, this inside information is now considered in the public
domain.

Strip Tinning Holdings plc

("Strip Tinning" or the Company")

Trading and Business Update

Trading materially ahead of expectations

Strip Tinning Holdings plc (AIM: STG), a leading supplier of specialist
connection systems to the automotive sector, is pleased to provide an update
for Q1 detailing a material improvement in its trading and business
performance.

Trading in the Battery Technologies ("BT") division has been strong, and the
Board now expects divisional revenue for FY25 to be more than 2.5 times FY24.
This strong performance in the higher margin BT division is more than
offsetting softness in the Glazing division, reflective of the wider
automotive sector. Additionally, the Board has continued to focus on
operational actions and its revised manufacturing strategy, as announced in
its 11 December 2024 update, to further reduce costs and ongoing working
capital requirements.

Consequently, the Board now expects to report a material c.£700k improvement
in its Adjusted EBITDA loss for FY25¹, reducing the loss to £0.9m, which is
half that reported for FY24.

In the December update, the Company also notified an increase in the expected
lifetime value of its leading BT nomination(2) for the supply of the Cell
Contact System ("CCS") for the battery pack modules for a US based autonomous
vehicle programme, from £43m to at least £56.8m. This contract is gathering
pace and is the primary driver of the increased sales in 2025 as sales of
pre-production parts has increased.  On 11 February 2025, the Company was
pleased to announce receipt of the $780k C samples order on schedule and the
subsequent D sample order is planned to follow this summer.  Serial
production is scheduled to start at Strip Tinning in April 2026.  The
customer programme is also gaining increasing US media attention(3) and the
customer now expects rides for fee paying passengers to start in 2025.

The Board does not currently anticipate the supply of the CCS will fall under
the recently proposed US Auto Parts tariffs, as the designated Export
Commodity Category ("ECC") code, under which the CCS is already being exported
to the US, does not fall within the automotive parts ECC coding
categorisations.

The Board previously notified that to fund ongoing operational demands, to
meet the production targets set by the BT nomination already signed and the
continued development of the BT business, additional investment would be
required in FY25. The Board continues to assess its optimum options to secure
the requisite funding and as part of this the Company announced it applied to
the UK Government's Automotive Transformation Fund for an up to £5.2m grant
to support additional capacity. Having passed the Expression of Interest stage
of the application process, the Board can now confirm it is in the detailed
application phase and further news on the outcome is anticipated in early Q3.

The Board is also pleased to confirm that the Company has received a
pre-determination letter from HMRC in respect of the Company's FY22 R&D
tax credit claim (payment of which had previously been expected in FY24). As
such, the Board now anticipates that it should receive a payment of c. £520k
from HMRC toward the end of April 2025. It is also further expected that
payment of the FY23 R&D tax claim estimated to be worth £250k will be
received in H2 2025.

The Board will provide further updates to shareholders as appropriate.

The Company expects to report its preliminary results for the year ended 31
December 2024 in early May.

Notes

1 Strip Tinning understands that as at the date of this announcement, market
expectations for the years ended 31 December 2025 are for Adjusted EBITDA
of (£1.6m). (Source: FactSet)

2 A nomination can be defined as a formal contract to supply components for
particular vehicle models or programmes over a certain period. All lifetime
values of nominations expressed at constant exchange rates as at 1 June 2024

3
https://www.wsj.com/podcasts/wsj-the-future-of-everything/could-amazons-zoox-beat-tesla-and-waymo-in-the-robotaxi-race/ee7d5dda-c53d-4f46-816a-71a2b9e216ba?mod=e2li
(https://url.uk.m.mimecastprotect.com/s/dN9PC4MNFB3WQgIxhWU4RVwG?domain=wsj.com)

The person responsible for arranging the release of this information on behalf
of the Company is Adam Robson, Executive Chair.

Enquiries:

Strip Tinning Holdings
plc
      Via Alma

Adam Robson, Executive Chair

Mark Perrins, Chief Executive
Officer

Kevin Edwards, Chief Financial Officer

 

Singer Capital Markets (Nominated Adviser and Sole
Broker)                    +44 (0) 20 7496 3000

Rick Thompson

James Fischer

 

Alma (Financial
PR)
striptinning@almastrategic.co (mailto:striptinning@almastrategic.co) m

Josh
Royston
+44 (0) 20 3405 0205

Joe Pederzolli
 

 

 

 

 

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