CT Automotive Group PLC Full Year Trading Update

RNS Number : 9765A

CT Automotive Group PLC

26 January 2024

 

26 January 2024

 

 

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE MARKET ABUSE REGULATION (EU NO. 596/2014) AS IT FORMS PART OF UK DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 ("MAR").

 

CT AUTOMOTIVE GROUP PLC

("CT Automotive" or the "Group")

 

Full Year Trading Update

 

Strong FY23 performance, with volume recovery and margin improvement continuing

 

CT Automotive, a leading designer, developer and supplier of interior components to the global automotive industry, issues the following trading update for the year ended 31 December 2023 ("FY23"), in advance of the publication of its annual results.

 

Return to profitable trading  

 

The Group returned to profit in FY23, with the strong performance of H1 continuing into H2 as global automotive production volumes continued to recover.

 

FY23 revenue is expected to be not less than $140 million¹. The improvement from $124 million in FY22 came from growth in both production revenue and revenue from tooling projects which completed in FY23.  As previously announced, tooling revenue has been weighted towards the second half of the year, reflecting the timing of customer projects.

 

Group gross profit margins have continued to improve, supported by the ongoing efficiency initiatives. These initiatives, which include automation, consolidation of certain product lines and labour cost savings through more efficient work streams, have progressed as planned over the year, delivering further savings in H2.

 

As a result, the Group expects to report FY23 underlying profit before tax of c.$8 million¹.

 

Balance sheet strengthened

 

The Group's balance sheet strengthened over the year as a result of strong operating cash conversion from the improved trading performance in the second half of the year, having also benefitted from the successful $9.6 million fundraise in H1.

 

The year end net debt position (pre IFRS 16) is expected to be c.$6 million¹ (FY22: $12 million), reduced from $9 million¹ as at 30 June 2023.

 

Outlook

 

The Group is encouraged by healthy order volumes and has entered FY24 with strong visibility of booked production and tooling revenue, with recent new programme wins extending visibility into future years.

 

The Board is closely monitoring the situation in the Red Sea and to date the Group has not experienced any material impact. The Group continues to maintain buffer stocks to mitigate any short-term disruption to shipping times.  While mindful of the wider macroeconomic and geopolitical uncertainty, the Board remains confident of making progress in the year ahead and in CT Automotive's long-term growth prospects.  

 

1.   Unaudited

 

Notice of Results

 

The Group will announce its results for the twelve months ended 31 December 2023 in early May 2024.

 

For further information, please contact:

 

CT Automotive                 Simon Phillips, Chief Executive Officer Anna Brown, Chief Financial Officer	via MHP
Liberum (Nominated Adviser and Broker) Richard Lindley Benjamin Cryer	Tel: [phone]
MHP (Financial PR) Tim Rowntree Charlie Barker Veronica Farah	Tel: [phone] [e-mail]

 

Notes to editors

 

CT Automotive is engaged in the design, development and manufacture of bespoke automotive interior finishes (for example, dashboard panels and fascia finishes) and kinematic assemblies (for example, air registers, arm rests, deployable cup holders and storage systems), as well as their associated tooling, for the world's leading automotive original equipment suppliers ("OEMs") and global Tier One manufacturers.

 

The Group is headquartered in the UK with a low cost manufacturing footprint. Key production facilities are located in Shenzhen and Ganzhou, China complemented by additional manufacturing facilities in Mexico, Türkiye and Czechia.

 

CT Automotive's operating model enables it to pursue a price leadership strategy, supplying high quality parts to customers at a lower overall landed cost than competitors. This has helped the Group build a high-quality portfolio of OEM customers, both directly and via Tier One suppliers including Forvia and Marelli.  End customers include volume manufacturers, such as Nissan and Ford, and luxury car brands such as Bentley and Lamborghini. In addition, the Group supplies electric car manufacturers, including Lucid. It is also working with e.GO Mobile, a German manufacturer which plans to launch a series of small electric vehicles for the budget end of the market.

 

The Group currently supplies component part types to over 47 different models for 19 OEMs. Since its formation, the Group has been one of the very few new entrants to the market, which is characterised by high barriers to entry.

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