TIDMFLO
RNS Number : 0979L
Flowtech Fluidpower PLC
17 April 2018
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")
Q1 2018 Trading Update
London: Tuesday 17 April 2018: AIM listed specialist technical
fluid power products supplier Flowtech Fluidpower plc (LSE: symbol
FLO), is pleased to announce the following unaudited update on its
performance for the three months ended 31 March 2018 and to the
period up to this announcement:
GROUP Trading Update AND FINANCIALS
Group revenue during the first three months of the current year
increased by 49.7%, of which 6.3% was organic, with the balance
representing acquisitive growth from the six deals completed in the
past twelve months. We continue to have positive momentum across
all divisions. Our Flowtechnology operation in the UK went through
its annual catalogue launch and general sales price increase on 1
April, which will provide further uplift in Q2, and with order
books for our more "project based" profit centres remaining ahead
of the same point last year, the short-term outlook is
encouraging.
Revenue for Q1 2018
--------------------------------------------------------
Divisions: Q1 2018 Q1 2017 Growth
Unaudited Unaudited
GBPm GBPm
--------------------- ----------- ----------- -------
Flowtechnology 10.7 10.1 5.9%
Power Motion
Control (PMC) 13.9 6.3 120.6%
Process 1.9 1.1 72.7%
--------------------- ----------- ----------- -------
Total Group revenue
for the period 26.5 17.5 51.4%
--------------------- ----------- ----------- -------
Net debt 18.4 5.5
--------------------- ----------- ----------- -------
Group gross margin % achieved again remains in line with market
expectations.
Net debt at c.GBP18.4 million is in line with management
expectations and reflects payments for the initial consideration on
the acquisition of Balu in March, further payments for the
contingent consideration of Hi-Power and Orange County, as well as
the receipt of the initial 50% tranche from our recent equity
placing. Following the General Meeting on 3 April 2018, the Group
received a further c.GBP5.2 million (after costs) under this
placing, and therefore at the date of reporting the Group now sits
with comfortable headroom within its GBP20 million banking facility
.
ACQUISITIONS
On 19 March 2018 the Group successfully completed the
acquisition of Balu Ltd, and its two trading businesses Beaumanor
Engineering and Derek Lane & Co. for a total consideration of
approximately GBP10.2 million. The unaudited financial statements
of Balu for the year to 31 January 2018 showed revenue of GBP11.4
million and proforma EBIT of GBP1.4 million. Unaudited net assets
excluding net debt at the same date were GBP5.9 million.
Beaumanor, founded in 1974 and based in Leicester, is an
importer and distributor of fluid power equipment in the UK. It has
a large customer base with no major customer concentration and
sources products from a range of suppliers. The business was one of
Flowtech's largest competitors in the "catalogue-based" market and
has now become part of the Flowtechnology Division, with local
management under the leadership of Profit Centre Director, Mark
Cropper, reporting directly to Flowtech CEO, Sean Fennon.
Derek Lane, founded in 1979 and based in Newton Abbot, Devon, is
a supplier of fluid power products and engineered solutions, and
its largest customer supports Ministry of Defence naval contracts
in the Devon area. Derek Lane has become part of the PMC Division
and local management under the leadership of Profit Centre
Director, Mark Venn, will report directly to Nick Fossey, Managing
Director UK & Ireland.
This acquisition provides a further complementary business to
the Group, creating a co-ordinated approach to three major
catalogue brands in the UK market place. It has widened our target
customer base using separate trading "styles" from the same
platform and will now look to replicate the wider Flowtechnology
model to deliver cost and service synergies. It also creates a
second logistics centre in Leicester to deliver stock optimisation
and supply chain improvements across the Group, as well as
establishing a substantial site in the important Midlands region of
the UK that operationally de-risks the main Skelmersdale site.
The Board is pleased to report that in the four weeks since the
acquisition was announced, the reaction from staff, customers and
suppliers has been positive, initial integration work on
procurement and IT integration is proceeding as expected, and the
scope for further sales enhancement due to cross selling
opportunities is encouraging.
outlook
The Board's view on the Outlook for 2018 and the broader
strategy to be pursued by the Group is outlined in the Operational
Review released today as part of the final statement of results for
the year ended 31 December 2017, which can be viewed by following
the link -
http://www.rns-pdf.londonstockexchange.com/rns/0979L_1-2018-4-16.pdf
Enquiries:
Flowtech Fluidpower plc
Malcolm Diamond MBE, Chairman
Sean Fennon, Chief Executive
Bryce Brooks, Chief Financial Officer
Tel: +44 (0) 1695 52796
Email: info@flowtechfluidpower.com
Zeus Capital Limited (Nominated Adviser and Joint
Broker)
Andrew Jones, Alistair Donnelly (corporate finance)
Dominic King, John Goold (sales & broking)
Tel: +44 (0) 20 3829 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
------------------------------------------------------------------------------
Founded as Flowtech in 1983, the Flowtech Group is
the UK's leading specialist supplier of technical
fluid power products. The business joined AiM in
2014. Today, the Group has four distinct divisions:
Division: What we do: Locations:
---------------- ------------------------------ ----------------------------
Flowtechnology Focus on supplying Flowtechnology
distributors and resellers Benelux (Deventer)
of industrial MRO products, Flowtechnology
primarily serving urgent China (Guangzhou)
orders rather than Flowtechnology
bulk offerings. It UK (Skelmersdale)
offers an unrivalled Indequip (Skelmersdale)
range of OEM and Exclusive Beaumanor (Leicester)
Brand products to over
3,400 distributors
and resellers. The
division has created
a definitive co-ordinated
approach to three major
catalogue brands in
the UK market place,
providing the definitive
source for fluid power
products, containing
over 100,000 individual
product lines and are
distributed to more
than 80,000 industrial
MRO end users.
---------------- ------------------------------ ----------------------------
Power Motion Specialise in the design, Primary Fluid Power
Control (PMC) assembly and supply (Knowsley)
of engineering components Nelson Fluid Power
and hydraulic systems (Dublin, Dungannon,
and is further enhanced Lisburn,)
by a service and repair TripleSix (West
function. Yorkshire)
Albroco (Knowsley)
Hydraulics & Transmissions
(Ludlow)
HiPower Hydraulics
(Belfast, Cork,
Dublin, Manchester)
Hydroflex (Brussels,
OudBeijerland,
Rotterdam)
Hydraulic Equipment
Supermarkets (Birmingham,
Durham, Gloucester,
Leeds)
Branch Hydraulics
(Gloucester)
Derek Lane (Newton
Abbot)
---------------- ------------------------------ ----------------------------
Process Focus on the supply Hydravalve (Willenhall)
of industrial components Orange County (Spennymoor)
and solutions to the
process sectors.
---------------- ------------------------------ ----------------------------
Onsite Services In 2018, the Group HES Onsite (Birmingham,
will extend its service Durham, Leeds,
offering to include Gloucester)
Onsite Technical Maintenance
through highly skilled
engineers.
---------------- ------------------------------ ----------------------------
All four of the Group's divisions have overlapping
product sets, allowing procurement synergies to be
maximised.
The above divisions are supported by a centralised
back office team at the Skelmersdale operation, shared
logistics centres in Skelmersdale and Leicester and,
a procurement and quality control team in Shanghai.
In total, the business employs over 550 people.
For more information please visit, www.flowtechfluidpower.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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