REG - Zotefoams PLC - Trading Update

ZotefoamsAnnouncement

17/12/2021 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20211217:nRSQ9613Va&default-theme=true

RNS Number : 9613V  Zotefoams PLC  17 December 2021

Zotefoams plc

("Zotefoams" or the "Group")

 

Trading Update

 

17 December 2021 - Zotefoams, a world leader in cellular materials
technology, today provides a trading update in respect of its financial year
ending 31 December 2021 ("FY 2021").

 

Further to the trading update of 3 November 2021, we have seen continued
commercial progress, with FY 2021 revenues shipped to date of approximately
£95m. The Group has a residual orderbook for FY 2021, supporting potential
sales of approximately £101m for the year (2020: £83m), slightly ahead of
current market consensus expectations.

 

However, in recent weeks the Group has encountered some specific supply chain
issues which have temporarily delayed the in-bound supply of product,
primarily at our UK facility. These issues have been substantially resolved
but the delays experienced will have an impact on the timing of shipments
either side of the year end. We currently expect that £1m of 2021 orders will
now be shipped in 2022 but there is a risk that up to a further £3m of orders
might similarly be delayed until 2022, given a volatile logistics backdrop.
The drop-through margin on these products is within a range of 50%-75%.

 

Overall, the Group continues to manage a challenging supply chain backdrop
effectively, in support of continued demand recovery. We have experienced some
short notice cost surcharges from energy-intensive suppliers, which have
increased our costs in the final quarter. Absent the shipping delays described
above, these costs were expected to have been offset in FY 2021 by the
stronger than expected sales performance, with pricing adjustments to be made
in 2022.

 

Commenting on the update David Stirling, Group CEO of Zotefoams, said:

"It is encouraging to see good organic revenue growth and we have actively
engaged with customers to secure price increases in 2021 and have also agreed
further price increases effective early in 2022. This does, however, remain a
challenging environment for many businesses, dealing with inflationary
pressures, supply chain challenges and uncertainty.

 

"It is disappointing that, given how close we are to the year end, this supply
chain issue will impact 2021 shipments. However, these orders will be
delivered early in the new year and the strong commercial momentum we have
seen through FY 2021 positions the Group very well for further progress in
2022 and beyond."

 

- Ends -

 

Enquiries:

 

 Zotefoams plc                +44 (0) 208 664 1600
 David Stirling, Group CEO

 Gary McGrath, Group CFO

 IFC Advisory                 +44 (0) 203 934 6630
 Graham Herring

 Tim Metcalfe

 Zach Cohen

 

 

The information contained within this announcement is deemed by the company to
constitute inside information stipulated under the Market Abuse Regulation
(EU) No. 596/2014 as it forms part of the domestic law of the United Kingdom
by virtue of the European Union (Withdrawal) Act 2018 (as amended) ("UK
MAR").  Upon the publication of this announcement via the Regulatory
Information Service, this inside information is now considered to be in the
public domain.

 

About Zotefoams plc

Zotefoams plc (LSE - ZTF) is a world leader in cellular materials technology
delivering optimal material solutions for the benefit of society. Utilising a
variety of unique manufacturing processes, including environmentally friendly
nitrogen expansion for lightweight AZOTE(®) polyolefin and ZOTEK(®)
high-performance foams, Zotefoams sells to diverse markets
worldwide. Zotefoams uses its own cellular materials to manufacture
T-FIT(®) advanced insulation for demanding industrial
markets. Zotefoams also owns and licenses patented microcellular foam
technology to reduce plastic use in extrusion applications and for ReZorce(®)
mono-material recyclable barrier packaging.

Zotefoams is headquartered in Croydon, UK, with additional manufacturing
sites in Kentucky, USA and Brzeg, Poland (foam manufacture), Oklahoma,
USA (foam products manufacture and conversion), Massachusetts, USA (MuCell
Extrusion) and Jiangsu Province, China (T-FIT).

www.zotefoams.com (http://www.zotefoams.com/)

AZOTE(®), ZOTEK(®), ReZorce(®) and T-FIT(®) are registered trademarks
of Zotefoams plc.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTGPGGAPUPGGRQ