REG - Victrex PLC - Q3 Trading Update

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RNS Number : 0618Q  Victrex PLC  08 July 2025

 

8 July 2025

Victrex plc - Q3 Trading Update

Volume momentum continues; Medical Spine remains challenging

Victrex plc is an innovative world leader in high performance polymer
solutions, delivering sustainable products which support CO2 reduction and
enable environmental and societal benefit in multiple end-markets. Today's
trading update for Q3 covers the period 1 April 2025 to 30 June 2025.

Q3 summary:

·      Continued Q3 volume momentum: sales volume +8% vs Q3 2024

o  Volume growth driven by Sustainable Solutions

o  Softer than expected Medical revenues, driven by Spine

o  Sales mix adversely impacted revenue and ASP

·      Cost discipline remains strong

·      Continuation of Q3 sales mix and ASP trends in Q4 would lead to a
broadly similar H2 underlying PBT result, versus H1

 

Q3 volume & revenue:

                          Quarter ended 30 June (Q3)           Nine months ended 30 June
                          2025       2024       % change       2025       2024       % change
 Sales volume (tonnes)    1,057      979        +8%            3,075      2,716      +13%
 Revenue (£m)             71.5       74.0       -3%            217.3      213.3      +2%
 ASP (£/kg)               68         76         -11%           71         79         -10%

 

 

Sustainable Solutions driving volume growth

Across Sustainable Solutions, Energy & Industrial and VARs were the main
drivers of growth in Q3, compared to the prior year. In Aerospace, sales
volumes were stable against tougher comparatives, with Automotive also stable
and Electronics ahead year-to-date.

Medical remains soft

Medical performance was lower than our expectations. Whilst we continue to see
good growth in Non-Spine, this was not sufficient to deliver overall
divisional improvement during the period. Spine remains the most impacted
application area within Medical, including impacts from industry destocking,
the effects from Volume Based Pricing (VBP) in China and alternative materials
in the US Spine market.

Price, mix & currency effects

Average selling price (ASP) in Q3 of £68/kg (Q3 2024: £76/kg) was impacted
by similar factors as H1 including lower Medical revenues, adverse mix within
both Medical and Sustainable Solutions and competitive pricing, primarily in
VARs.

 

Currency increased in impact during Q3 to account for nearly one-third of the
year-on-year ASP impact in the quarter.  As a result of declining ASP, volume
growth of 8% in Q3 translated to a revenue decline of 3%.  A continuation of
similar ASP trends during Q4, versus the prior year, is expected.

 

China: production rates improving

In our new China manufacturing facility, we are making progress in resolving
initial scale-up challenges. Production rates slightly improved during Q3 and
product is being delivered to customers.

 

Mega-programme milestones

During the period, we saw the first PEEK Knee surgeries for the US clinical
trial, bringing the total number of patient implants, including in Europe and
India, to 65.  In Magma, following the announcement from TechnipFMC for a
technological order award from Petrobras, we are supporting TechnipFMC with
pipe extrusion programmes as part of advanced qualification work.

 

Robust financial position

The Group is on track for lower capital expenditure (at the lower end of our
8-10% of revenue guidance for the full year). Inventory is also reducing on
plan. Net debt on 30 June 2025, after payment of our interim dividend on 27
June, was £42.8m (Q3 2024: £39.6m), which includes cash of £19.7m.

 

Currency remains a headwind to profit for FY 2025. The impact of currency at
PBT level is now closer to £9m, at the higher end of our guidance. With
further strengthening of Sterling against the US dollar and Euro, currency for
FY 2026 is now tracking at approximately £3-4m adverse to FY 2025. Currently,
hedging is in place to cover over 50% of our US dollar and Euro foreign
currency exposure in FY 2026 and this cover will increase to c75% by 30
September.

 

Outlook

Jakob Sigurdsson, Chief Executive, said: "Overall Q3 trading saw continued
volume momentum, offset by a softer than expected performance in Medical and
further adverse sales mix within Sustainable Solutions.

 

"The Group is well positioned to deliver at least high single digit volume
growth for the full year, in line with guidance, although the remainder of FY
2025 sees a tougher comparative and we are mindful of ongoing macroeconomic
uncertainty. At profit level, our range of outcomes reflect the impact of an
adverse sales mix in both divisions, a weaker Medical performance and the
headwinds from our new China manufacturing facility, as well as a c£9m
currency headwind. Whilst we are targeting H2 underlying PBT to be slightly
improved on H1 underlying PBT of £23.2m, a continuation of Q3 sales mix and
ASP trends for the remainder of the year, particularly in Medical Spine, would
result in H2 underlying PBT being at a broadly similar level as H1.
 

 

"As we navigate macroeconomic uncertainty, the Group has strong cost
discipline and improvement actions in place. These include Project Vista and
our focus on Sales Excellence. Overall, we have confidence in our medium to
long-term growth prospects, well invested assets and an improving cash
position."

 

Victrex will report its FY 2025 Preliminary results on Tuesday 2 December
2025.

 

Analyst & investor call:

A call for analysts & investors will be held today, Tuesday 8 July, at
08.30am UK time. To register for the call or listen to the replay, please
follow this link:

Victrex Q3 Interim Management statement Registration Page!
(https://registrations.events/direct/LON3526689)

 

Victrex plc:

 Andrew Hanson, Director of Investor Relations, Corporate Communications &      +44 (0) 7809 595831
 ESG
 Jakob Sigurdsson, Chief Executive                                              +44 (0) 1253 897700
 Ian Melling, Chief Financial Officer                                           +44 (0) 1253 897700

 

About Victrex:

Victrex is an innovative world leader in high performance polymer solutions,
focused on the strategic markets of Automotive, Aerospace, Energy &
Industrial, Electronics and Medical. Every day, millions of people rely on
products or applications which contain our sustainable materials, from
smartphones, aeroplanes and cars to oil & gas operations and medical
devices. With over 40 years' experience, we are moving beyond the polymer into
semi-finished and finished products which shape future performance for our
customers and our markets, enable environmental and societal benefit for our
customers and drive value for our shareholders. Find out more at
www.victrexplc.com (http://www.victrexplc.com)

 

This Q3 Trading Update is based upon unaudited management accounts
information. Forward-looking statements have been made by the Directors in
good faith using information available up until the date that they approved
this statement. Forward-looking statements should be regarded with caution
because of the inherent uncertainties in economic trends and business risks.

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