TIDMFLO
RNS Number : 5220K
Flowtech Fluidpower PLC
10 July 2017
NEWS RELEASE
Issued on behalf of Flowtech
Fluidpower PLC
Immediate Release
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. Upon the publication of
this announcement via the Regulatory Information Service, this
inside information
is now considered to be in the public domain.
FLOWTECH FLUIDPOWER PLC
("Flowtech", the "Group" or "Company")
Group Trading update and Notice of HY results
London: Monday, 10 July 2017: AIM listed specialist technical
fluid power products supplier Flowtech Fluidpower plc (LSE: symbol
FLO), issues the following unaudited Trading Update for the
six-month financial reporting period ended 30 June 2017:
GROUP Trading Update
It is very pleasing to report that Group revenue during the
first half of the current year increased by 24.7%. Our strong
performance is being driven by the continued momentum across all
the business divisions and further enhanced by the contribution
from new subsidiaries.
Revenue for the period ended 30
June 2017
GBP'000 HY1 HY1 Growth
2017 2016
Flowtechnology 19,326 18,093 + 6.8%
Power Motion
Control (PMC) 12,706 8,268 + 53.7%
Process 2,120 1,026 + 106.6%
---------------- ------- ------- ---------
Total Group
revenue for
the period 34,152 27,387 +24.7%
---------------- ------- ------- ---------
Net debt 8.3 14.1
---------------- ------- ------- ---------
The Flowtechnology division has increased its revenues by 6.8%.
As well as the acquisition of Indequip in February 2016, this
improvement has been powered by strong organic growth within the
core business, set against market conditions that remain generally
challenging. The Flowtechnology division has continued to develop
its product set and service offering while increasing its market
opportunities; this depth of understanding has been the foundation
for the growth. Underlying trading is solid and we expect to make
further positive progress over the year and beyond.
Power Motion Control division has also increased its revenues by
53.7% which is a mix of strong underlying growth from each business
and a contribution from recent acquisitive activity already
covered. All the businesses within this unit are highly technical
and complementary to each other. Under the PMC banner we deliver a
collaborative approach to our customers and this has created
increased impetus and opportunity for the Group. The order book is
solid and we enter the second half of the year in a good position
that indicates that further growth will be achieved.
Growth in the newest division Process reflects a mix of organic
and full year effects from the acquisition of Hydravalve in March
2016, and will now be enhanced by the acquisition of Orange County
which has been announced today.
http://www.rns-pdf.londonstockexchange.com/rns/5220K_1-2017-7-9.pdf
FINANCIALS
The Group's ongoing focus on GP across all the divisions, linked
to our flexible pricing models and specialised procurement
programmes has enabled the business to maintain and develop its
Gross Margins in line with market expectations; the balance sheet
remains strong, with cash generation also in line with our targets
set. Net Debt continues to be well within available facilities and
covenants providing further scope for the Company to utilise its
own resources to fund accretive acquisitions in H2.
ACQUISITONS
At the start of the six-month period, the Group acquired
Hydraulics & Transmissions Limited (HTL) (20 January 2017).
This business has strengthened our position with key global
suppliers and delivers incremental revenue to the Group that
previously it could not address. HTL has been successfully
integrated into PMC. On the 23 June 2017, we further boosted the
PMC offering by adding new technical expertise through the
acquisition of Hi-Power Limited, a distributor of hydraulic
components and systems design. Although Hi-Power has not
contributed to the H1 results, it will as we move forward deliver
incremental revenue as well as extending Flowtech's position with
key European suppliers. The Group's acquisition and control
processes which are in place have allowed the integration of both
HTL and Hi-Power into the business quickly and with little
disturbance to the customer facing trading businesses. Both these
businesses are trading strongly.
The successful capital raising at the end of March 2017 has let
us more actively pursue acquisitions; under a separate announcement
today we have acquired a further complementary business with high
level technical engineering skills and established relationships
with world-leading manufacturers.
http://www.rns-pdf.londonstockexchange.com/rns/5220K_1-2017-7-9.pdf
The acquisition and product pipeline remains strong and
continues to develop; we have several more opportunities that will
add value and enhance our current brand portfolio and offering and,
we are confident that we will conclude a number of these
transactions over the coming months.
INVESTMENT FOR THE FUTURE
As part of the ongoing development of the overall business, the
Shared Logistics Centre based at Skelmersdale is in the process of
redevelopment. This investment initiative which is expected to be
completed by the end of September 2017, will increase capacity by
over 40%, and will deliver greater operational and stocking
efficiencies for use by the entire Group.
SUMMARY
Our focus continues to be growth through both acquisitive and
organic means backed up by our four-layered approach to extracting
synergistic benefits over the short, medium and long term. This
targeted approach ensures we can achieve both a concentration and
enhancement to our product set which is the core of our business
model. The Board believe that the acquisitions so far this year
clearly reinforce the ongoing strategy to develop a focused Fluid
Power Group that serves a wide number of industry sectors, allowing
a de-risking of some of the cyclic nature of the business.
The Group's current underlying performance will deliver another
year of solid progress. As a business, we are confident in our
strategy, commercial opportunities and the prospects of the Group
and, the business remains on track to meet current market
expectations for the year ending 31 December 2017.
Notice of results
The Group will release its Half-Year results on Tuesday 12
September 2017. The HY results will be available to view and
download from the Company's website www.flowtechfluidpwer.com. In
addition, a presentation of these results will also take place on
the day via conference call facility - further details or to join
the conference can be requested via the Nomad, Joint Broker, or by
contacting the IR Company, details of which are shown below.
Enquiries:
Flowtech Fluidpower plc
Sean Fennon, CEO
Bryce Brooks, CFO
Tel: +44 (0) 1695 52796
Email: info@flowtechfluidpower.com
Zeus Capital Limited (Nominated Adviser and Broker)
Andrew Jones, Jonathan Sharp (corporate finance)
Dominic King, John Goold (sales & broking)
Tel: +44 (0) 203 829 5000
finnCap Limited (Joint Broker)
Ed Frisby, Kate Bannatyne (corporate finance)
Rhys Williams, Emily Morris (sales & broking)
Tel: +44 (0) 20 7220 0500
TooleyStreet Communications (IR and media relations)
Fiona Tooley: Tel: +44 (0) 7785 703523 or email:
fiona@tooleystreet.com
EDITORS' NOTES
About Flowtech Fluidpower plc: visit
www.flowtechfluidpower.com
The business was founded as Flowtech in 1983, and is the UK's
leading specialist supplier of technical fluid power products. The
Flowtech Group has three divisions: Flowtechnology, Power Motion
Control and Process. All three of the Group's divisions have
overlapping product sets, allowing procurement synergies to be
maximised.
The Flowtechnology division focuses on supplying distributors
and resellers of industrial MRO (maintenance, repair and operation)
products, primarily serving urgent orders rather than bulk
offerings. It is formed from Flowtechnology UK, Flowtechnology
Benelux and Indequip. It offers an unrivalled range of Original
Equipment Manufacturer (OEM) and Exclusive Brand products to over
3,400 distributors and resellers and the catalogues are recognised
as the definitive source for fluid power products, containing
100,000 individual product lines and are distributed to more than
80,000 industrial Maintenance, Repair and Overhaul end users (MRO).
The Power Motion Control division specialises in the design,
assembly and supply of engineering components and hydraulic systems
and is further enhanced by a service and repair function. The
division is formed from Primary Fluid Power, Nelson Hydraulics, TSL
Fluidpower and HTL. The Process division focuses on the supply of
industrial components to the process sectors.
The Group's main distribution centre is in Skelmersdale,
Lancashire with further distribution centres in the Netherlands and
China. The Power Motion Control division (PMC) has operations in
Merseyside, Northern Ireland, the Republic of Ireland, Shropshire
and Yorkshire; Process operates from the West Midlands & County
Durham. In total, the business employs over 318 people.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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