Grafenia plc AGM Trading Statement (7784L)
15 September 2021 - 04:00PM
UK Regulatory
TIDMGRA
RNS Number : 7784L
Grafenia plc
15 September 2021
Prior to publication, the information contained within this
announcement was deemed by the Company to constitute inside
information as stipulated under the UK Market Abuse Regulation.
With the publication of this announcement, this information is now
considered to be in the public domain.
15 September 2021
Grafenia plc
("Grafenia", the "Group" or "Company")
AGM Trading Statement
The Annual General Meeting of Grafenia plc (AIM: GRA) will take
place today at 10.00am and, in advance of that, the Company issues
the following trading statement. UK Government guidance presently
remains that Coronavirus cases are high and rising and everybody
needs to continue to act carefully and remain cautious. In light of
the continued risk to staff and shareholders, we took the decision
to encourage shareholders not to travel and attend the AGM in
person and to submit proxy votes in advance. An online presentation
will follow the meeting at 10.30am.
Trading update
Since the announcement of our Final Results (year ended 31 March
2021) on 28 July 2021, we're pleased to announce trading has
continued to improve. In August, we recorded our highest sales
since November 2019. For the five months from April to August,
total revenue was 20% higher than the same period last year.
In our Annual Report, we discussed the impact of cancelled
events and exhibitions. As Government restrictions have been
lifted, each new round of easing has resulted in increased business
activity. We have a diverse range of products and services,
covering most of what a modern business needs to market themselves.
Last year, some segments were affected more severely than others.
Before the pandemic, margins were eroding on traditional litho
print and we have been gradually reducing our reliance on those
sales. Litho was hardest hit in the pandemic and now represents
around a quarter of our total revenue. However, since the start of
the new financial year, we've seen growth across all product
segments, even in litho print.
We have been adding new product categories across packaging,
apparel and promotional gifts and giveaways. These niche products
are predominantly manufactured by third party Works Makers, which
is integrated in our supply chain. They extend the range of things
our Nettl and printing.com partners can say yes to. We invite
specialist producers of personalised items to register free at
www.nettl.works .
Our platform
Since the start of the year, we've continued to add new Nettl
partners in the UK and US. We're making good progress on our
digital transformation project, to enable partners to sell complex
sign and display projects. We call these 'Plans'. We're rolling out
a new tool to enable partners to build beautiful Proposals to share
with clients. They can quickly edit a pre-written model proposal
and pull in detailed Plan sections automatically. It's easy to
visually add print and standard products from our catalogue, as
well as their own in-house items. Partners simply share a secure
link and clients can accept and pay online. Our aim is to equip our
partners with the tools they'll need in the studio of tomorrow and
to work in a way that extends their capabilities.
Software Circle
In our Final Results, we discussed a shift in focus of our
acquisition strategy. We are now searching for software businesses
to bring into the Group. During the summer we ran an internship
programme for MBA students of Entrepreneurship by Acquisition in
conjunction with London Business School. These interns became
fellows of "Software Circle", our outreach and direct approach
programme.
We are pleased with the calibre of the intern 'searchers' and
quality of opportunities and have a number of ongoing discussions
with owners of software businesses. Of course, a deal isn't a deal
until it's signed, yet we feel confident that we are on the right
track.
Outlook
Autumn usually displays strong seasonality. Last year the second
wave of Coronavirus began to adversely affect business activity.
What will this year bring? Difficult to say. There go we, but for
the grace of Government rules. That said, we're a leaner business
than we were going into the pandemic. Our break-even point is
lower. Modest increases in revenue improve our profitability. Like
many businesses, we're seeing inflationary pressures on material,
energy and distribution costs. Nevertheless, we remain focused on
achieving our mid-term goal of 10-15% EBITDA. We're encouraged that
our most recent trading month was around that range.
For further information:
Grafenia plc
Peter Gunning (Chief Executive Officer) 07973 191 632
Allenby Capital Limited (Nominated
Adviser and broker)
David Hart / Liz Kirchner 0203 328 5656
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