Luceco PLC Trading Update (4332Z)
15 December 2017 - 6:00PM
UK Regulatory
TIDMLUCE
RNS Number : 4332Z
Luceco PLC
15 December 2017
15 December 2017
Luceco plc
("the Group")
Trading Update
Luceco plc, the manufacturer and distributor of high quality and
innovative LED lighting products, wiring accessories and portable
power products, is today issuing the following trading update for
the year to 31 December 2017.
The Group has seen gross margins weaken during the second half
of the year and will now deliver gross margin of approximately 33%,
leading to a GBP3.5m reduction in profit after tax to GBP13.2m,
versus current market expectations of GBP16.7m.
Regrettably, the gross margin weakness was not identified sooner
due to an incorrect assessment of the value of the Group's stock.
The Group's Financial Controller has resigned as a result of this
error. System improvements are being put in place to make sure this
issue does not recur.
The principal reasons for the gross margin weakness have been
the strengthening of the Chinese RMB versus the US Dollar,
alongside the ongoing weakness in GBP and increased commodity
costs.
The Group will be able to mitigate some of these headwinds
through internal efficiency savings and overhead reductions, with
margins expected to recover to long term expectations in H2 2018 as
a result of these actions. The Group also intends to increase its
foreign exchange and commodity price hedging activities with
particular focus on the Chinese RMB versus the US Dollar.
Luceco's revenue forecasts for 2017 and 2018 remain in line with
market expectations. We continue to expand the Group's product
ranges and our geographic reach. Luceco's balance sheet remains
strong and the Board continues to assess opportunities to invest in
the future growth of the business.
-ENDS-
Further enquiries:
For further information, please contact
Luceco plc via MHP Communications
John Hornby, Chief Executive 020 3128 8100
Officer
David Main, Chief Financial
Officer
MHP Communications
Tim Rowntree
James White
Ollie Hoare 020 3128 8100
Notes to Editors:
Luceco is a rapidly growing manufacturer and distributor of high
quality and innovative LED lighting products and wiring accessories
for a global customer base.
The Group supplies trade distributors, retailers, wholesalers
and project developers with a wide range of products which broadly
fall into the following market recognised brands:
- Luceco: energy efficient LED lighting products and associated accessories;
- British General (BG): wiring accessories (including switches,
sockets), circuit protection and cable management products;
- Masterplug: cable reels, extension leads, surge protection, timers and adaptor products; and
- Ross: television wall mounts, audio visual accessories and other items.
The Luceco LED lighting brand continues to benefit from the
disruptive shift away from mature lighting technologies as a result
of the material advancement in LED technology in recent years. The
brand has continued to successfully leverage the Group's existing
customer base and low cost Chinese manufacturing facility.
Consequently, it remains well positioned to build on its impressive
organic growth trajectory to date.
In the electrical wiring accessories market, Luceco's BG and
Masterplug brands have continued to reinforce their market leading
positions through further new product development initiatives,
expanding into new product adjacencies and gaining market
share.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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