REG - Trifast PLC - Trading Update

TrifastAnnouncement

22/01/2024 07:00

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RNS Number : 3740A  Trifast PLC  22 January 2024

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 the Regulatory Information
Service, this inside information is now considered to be in the public domain.

 

 

 

London, Monday 22 January 2024

 

 

TRIFAST PLC

(Trifast, Group or Company)

 

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

 

Trading update

 

 

Market conditions during Q3 saw a continuation of the trends described in the
Group's interim results, published on 21 November 2023, characterised by low
visibility and volatile demand in a number of end market and geographic
segments.  Disappointingly, performance in December 2023 was impacted by
significantly lower than forecasted volumes in both our Asia operations and
global distribution sales channel.  Whilst we had anticipated both of these
areas to see a recovery from subdued activity in H1, demand conditions and
excess customer inventory levels have pushed this recovery further into 2024
and we now expect these challenging conditions to persist through to the end
of the financial year.

As set out in the interim results and in spite of the difficult backdrop,
management have continued to focus on the Operational Improvement programme
instigated in 2023 to drive improved efficiency and productivity for HY2 and
beyond.  Whilst good progress has been made in reducing cost in a number of
areas, this will not be enough to mitigate the impact of the lower revenue
expectation for the second half.  Consequently, the Board now expects that
the Group's results for the year ending 31 March 2024 to be significantly
below its previous expectations, with revised revenue at c.£230m and adjusted
EBIT margin percentage of c.5%.

The more testing environment that we are now experiencing in 2024 in terms of
growth is being severely impacted by a further slowdown in customer demand and
volumes across the business and to an extent by the reported macro-economic
challenges and geopolitical events.

As a consequence of the prevailing markets, continued weak economic outlook
and the impact of this on the business we have accelerated our recovery action
plan, including a Group restructuring programme to further reduce  operating
cost through a c.10% cutback in our non-operational staff globally.  This
programme is expected to deliver additional annualised savings of c.£3m.  As
part of the restructure, we will establish a leaner organisational structure
to enable faster decision making.  In parallel, we are undertaking a
strategic review of our global footprint to identify further cost efficiencies
which will reset our business for the future.

As we previously announced, working capital and cash management remain a key
focus; we predict to effectively reduce leverage below 1.5x and Group net debt
to be below our target of £25m.  Our UK National Distribution Centre and
Atlas projects are, as previously committed, on track to be completed by the
end of March 2024.

As a Group, the Balance sheet remains strong, we continue to see significant
scope to rebuild and invest in the business and we remain confident in the
fundamentals of our business model over the medium-term.

 

We will provide more detail on the restructuring, strategic plans and progress
at the time of the Group's annual results scheduled to be released in July
2024.

 

 

*Consensus forecasts FY24 prior to this announcement were revenue of £254m
adjusted EBIT £15.5m

 

 Enquiries please contact:
 Trifast plc
 Serena Lang, Non-Executive Chair
 Iain Percival, Chief Executive Officer
 Darren Hayes-Powell, Chief Financial Officer
 Office: +44 (0) 1825 747630
 Email: corporate.enquiries@trifast.com
 (mailto:corporate.enquiries@trifast.com)
 Shareholders: companysecretariat@trifast.com
 (mailto:companysecretariat@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 (TR)

 Founded in East Sussex in 1973, 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.

 The Group supplies to customers in c.70 countries across a wide range of
 industries, including light vehicle, heavy vehicle, health & home, energy,
 tech, & infrastructure (ET&I), general industrial and distributors. As
 a full service provider to multinational OEMs and Tier 1 companies spanning
 several sectors, we deliver comprehensive support to our customers across
 every requirement, from concept design through to technical engineering
 consultancy, manufacturing, supply management and global logistics.

 As an international business we are able to provide 24/7 customer support from
 across key regions in the UK, Asia, Europe and North America. In addition to
 our service locations we operate a number of manufacturing facilities focused
 on high volume cold forged fasteners and special parts. We have also
 established Technical & Innovation Centres to support R&D and customer
 collaboration across the world.

 For more information, visit our

 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)

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

 LEI number: 213800WFIVE6RWK3CR22

 

 

 Forward-looking statements
 This announcement contains certain forward-looking statements. These reflect
 the knowledge and information available to the Company during the preparation
 and up to the publication of this document. By their very nature, these
 statements depend upon circumstances and relate to events that may occur in
 the future thereby involving a degree of uncertainty. Therefore, nothing in
 this document should be construed as a profit forecast by the Company.

 

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