Character Group PLC Trading Update (7855L)
15 September 2021 - 4:00PM
UK Regulatory
TIDMCCT
RNS Number : 7855L
Character Group PLC
15 September 2021
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.
THE CHARACTER GROUP PLC
("Character", the "Company" or "Group")
Designers, developers and international distributor of toys,
games and giftware
Trading Update
London: Wednesday 15 September 2021 : The Board of Character
provides the following update to shareholders on Group trading
ahead of the publication of its results for the year ended 31
August 2021 which are scheduled to be released in December
2021.
Trading
The re-opening of the bricks and mortar retail sector following
the easing and, subsequently, the lifting of COVID-19 restrictions
in many of our markets has had a buoyant impact on sales generally.
Throughout the second half of the year, the Group continued to
experience a strong performance in sales of its product portfolio,
with many brands outperforming management expectations.
Despite this strong performance, t he outcome for the full year
has been affected by several factors that we identified at the time
of our interim results announcement in April 2021, which have since
deteriorated further. Like many companies, the global logistical
challenges (such as the ongoing delays at ports, shipping and
container shortages, exponential increases in freight rates, and
increased costs of inland transportation in China and the UK),
coupled with the pressure on the costs of production in China due
to higher raw material and labour costs, has had an impact on
profitability. The immediate outlook for an early improvement in
supply chain efficiency to ensure timely fulfilment is currently
unclear. Notwithstanding this and the variety of challenges that
the Group has faced and is facing, our determined and unswerving
dedicated teams in UK, Scandinavia, Hong Kong, and China have
reacted positively to these issues. They have all worked extremely
hard in tackling the logistics problems from the Far East, to
focusing on getting product containers delivered to our warehouses,
and onward deliveries to our customers. Consequently, there has
been limited downside and we expect the Group's underlying profit
before tax for the year ended 31 August 2021 to decrease by no more
than 10% of market expectations*.
As stakeholders are aware, ongoing work on the development of
new concepts is important to our success in formulating new ranges
for future sales as well as to replace licence and distribution
product agreements which expire. New opportunities are looked at on
an on-going basis. Development of the Group's product portfolio for
the new calendar year is well advanced and the reception to date
from the Group's customers, following early previews and
presentations, has once again been very positive. Order levels
continue to be strong and the prospects for a good sell through
remain very favourable.
Against the backdrop of challenges noted above the Group has
finished its financial year in a strong position, with a robust
balance sheet, a sizeable cash balance, and with substantial
unutilised working capital facilities.
Overall, the Group is in great shape to address the
opportunities and challenges that lie ahead.
Tender Offer
Character expects to update the market regarding the launch of
its tender offer later this month.
Note:
*Current market consensus compiled by the Company for the year
ended 31 August 2021, prior to the release of this announcement, is
revenue of c.GBP140m and underlying profit before tax of
c.GBP12.0m
The Character Group plc
FTSE sector : leisure goods:
FTSE AIM All-share: symbol: CCT
Market cap : GBP148.1m
Email: info@charactergroup.plc.uk
Group website: www.thecharacter.com
Product ranges can also be viewed at
www.character-online.co.uk
CHARACTER GROUP PLC CCT Stock | London Stock Exchange
Enquiries to:
The Character Group plc
Jon Diver, Joint Managing Director
Kiran Shah, Joint Managing Director & Group Finance Director
Office: +44 (0) 208 329 3377
Mobile: +44 (0) 7831 802219 (JD)
Mobile: +44 (0) 7956 278522 (KS)
Panmure Gordon (Nominated Adviser and Joint Broker)
Atholl Tweedie, Investment Banking
Charles Leigh-Pemberton, Corporate Broking
Rupert Dearden, Corporate Broking
Tel: +44 (0) 20 7886 2500
Allenby Capital Limited (Joint Broker)
Nick Athanas, Corporate Finance
Amrit Nahal, Sales & Corporate Broking
Tel: +44 (0) 20 3328 5656
TooleyStreet Communications Limited (Investor and media relations)
Fiona Tooley
Tel: +44 (0) 7785 703523
Email: fiona@tooleystreet.com
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