REG - Trifast PLC - Trading update & Notice of Annual results

TrifastAnnouncement

05/05/2022 07:00

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RNS Number : 3702K  Trifast PLC  05 May 2022

 

 

 

 

Trifast plc

(Trifast, or Group)

 

"Innovation today for a better tomorrow - Growing sustainably, together"

 

Trading Update & Notice of Full Year Results

 

London, Thursday, 5 May 2022:  Trifast plc (LSE Main market premium listing:
symbol: TRI), a leading international specialist in the design, engineering,
manufacture, and distribution of high-quality industrial fastenings and
Category 'C' components principally to major global assembly industries,
issues the following unaudited Trading Update for the year ended 31 March 2022
(FY2022) ahead of the announcement of its Full Year results on 21 June 2022.

 

TRADING UPDATE

Strong trading continued in Q4, contributing to year-on-year organic revenue
growth at constant exchange rate (CER) of c.15% for FY2022 (organic growth at
CER of c.9% against FY2020). As a result, the Group expects to report an
overall trading performance for FY2022, in line with the Board's expectations.

 

Driven by strong underlying demand, sales to distributors remained very high
in the final quarter and our Hungarian operations saw robust growth in the
energy, tech & infrastructure (ET&I) sector.  Light vehicle sector
volumes continue to experience high levels of volatility in demand due to
ongoing supply chain disruption, particularly in Europe and the UK.  Towards
the end of Q4, we started to see this disruption move into the health &
home sector, with temporary factory closures across several of our Global OEMs
operating in Europe.

 

The Covid-19 lockdowns in Shanghai, have had a limited impact on FY2022
trading, however, we are currently unable to trade above a minimal level due
to the restrictions in place.  The impact on our wider Asia region has not
been significant to date.  Our North America region continues to go from
strength to strength, with strong organic revenue growth at our Houston site,
driven by light vehicle and ET&I sales, being further supplemented by a
solid trading performance from TR Falcon.  The Ukraine conflict has had a
minimal direct impact on the business in Q4, with <1% of our global OEM
revenues going into Russia and Ukraine.  However, we have seen this
exacerbate wider supply chain disruption, especially in Europe.

 

We have successfully concluded most of our phase one price increase programme
negotiations.  Although further inflationary cost increases have held back a
full margin recovery, we are pleased to report that in March 2022 we recorded
gross margins much closer to historic levels. We expect price increase
negotiations to be an ongoing part of doing business in the current
macroeconomic environment.  With this in mind, we are already reaching out to
our customer base to discuss a prompt pass-on of relevant additional costs,
including increased energy and broader macro costs.

 

Supply chain challenges remain and although lead times are now stabilising
across most of the world, these continue to stand at high levels.
 Considering this challenging backdrop and given our strong financial
position, the business has continued to invest in inventory levels in the
second half to ensure reliability of supply.  Net debt (before IFRS16) at the
period end was c.£25m, with this expected to reduce and drive historically
high cash generation rates, as the macroeconomic environment settles.

 

Our acquisition strategy continues at pace and a good pipeline of targets in
North America and beyond, present us with several exciting opportunities at
different stages of the process.

 

PROJECT ATLAS

Project Atlas, a key driver of future growth and cost efficiencies, has
continued to progress in the period.  We are currently in a phased roll-out
to our highest revenue trading subsidiary, TR Fastenings (UK), which is
expected to complete by the end of calendar year 2022.

 

OUTLOOK

The Board believes that the fundamentals of our business model and strategy
position us well to become a bigger, more profitable company in the
medium-term.  A continued focus on service levels and responsiveness have
strengthened the Group's position in its established markets during this
challenging period.  We continue to see exciting opportunities in high growth
and emerging technologies, including in the electric vehicle space, where our
secured order pipeline has never been stronger.  Strong momentum in contract
wins, and new order pipeline, means we are looking ahead with confidence,
although we remain mindful of the current macro level headwinds.

 

 

 

 Further enquiries please contact:
 Trifast plc
 Jonathan Shearman, Non-Executive Chair
 Mark Belton, Chief Executive Officer
 Clare Foster, Chief Financial Officer
 Tel: +44 (0) 1825 747630
 Email: corporate.enquiries@trifast.com
 (mailto:corporate.enquiries@trifast.com)

 

 Peel Hunt LLP (Stockbroker & financial adviser)
 Mike Bell
 Tel: +44 (0) 20 7418 8900

 

 TooleyStreet Communications, (IR & media relations)
 Fiona Tooley
 Tel: +44 (0)7785 703523
 Email: fiona@tooleystreet.com (mailto:fiona@tooleystreet.com)

 

 

 Editors' notes
 About Trifast plc

 Trifast (TR) is a leading international specialist in the design, engineering,
 manufacture, and distribution of high-quality industrial fastenings and
 Category 'C' components principally to major global assembly industries.

 TR supplies to c. 5,000 customers in c.75 countries across a wide range of
 industries, including Light vehicle, Heavy vehicle, Health & Home, Energy,
 Tech and Infrastructure (ET&I), General industrial and Distributors. As a
 full-service provider to multinational OEMs and Tier 1 companies spanning
 several sectors, TR delivers comprehensive support to its customers from
 concept design through to technical engineering consultancy, manufacturing,
 supply management and global logistics.

 TR employs c.1,300 people across 34 business locations within the UK, Asia,
 Europe, and the USA including seven high-volume, high-quality, and
 cost-effective manufacturing sites and three technical & innovation
 centres across the world.

 For more information, visit

 Investor website: www.trifast.com (http://www.trifast.com)

 Commercial website: www.trfastenings.com (http://www.trfastenings.com/)

 LinkedIn: www.linkedin.com/company/tr-fastenings
 (http://www.linkedin.com/company/tr-fastenings)

 Twitter: www.twitter.com/trfastenings (http://www.twitter.com/trfastenings)

 Facebook: www.facebook.com/trfastenings (http://www.facebook.com/trfastenings)

 Note

 Trifast, TR and TR Fastenings are registered trademarks of the Company.

 LEI number: 213800WFIVE6RUK3CR22

 

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