Unigel Group PLC Final Results, AGM Notice & Dividend Declaration (8531B)

TIDMUNX

RNS Number : 8531B

Unigel Group PLC

06 June 2023

Unigel Group plc

(the "Group" or the "Company")

Final Results, Notice of AGM and Dividend Declaration

Unigel Group plc (AQSE: UNX), the manufacturer and distributor of materials used in the manufacture of telecommunication fibre optic cables announces its audited final results for the post-acquisition period from 1 July 2022 to 31 December 2022.

The post-acquisition turnover for the six month period from 1 July 2022 to 31 December 2022 was GBP18.8m with a gross profit margin of 11.8%, producing a profit after tax of GBP323,547.

For the full 12 month period from 1 January 2022 to 31 December 2022, the Group achieved turnover of GBP36.8 million.

The final report and accounts will be available on the Company's website shortly.

Notice of AGM

The Company announces that the Annual General Meeting ("AGM") of the Company will be held on 29 June 2023 at 10:00 a.m. at the offices of Shakespeare Martineau LLP at 6th Floor, 60 Gracechurch Street, London, EC3V 0HR, United Kingdom.

A notice of AGM, together with the form of proxy, has been sent to the shareholders of the Company ("Shareholders") today. The notice of AGM will also be shortly available for inspection on the Company website, http://www.unigel.com .

Full details of the operation and arrangements for the AGM are set out in the notice of AGM.

Dividend declaration

The Company's has declared a final dividend of 2.5p per ordinary share, subject to shareholder approval at the Company's forthcoming AGM.

The ex-dividend date for the final dividend is 22 June 2023, the record date is 23 June 2023 and the expected payment date is on or around 31 July 2023.

This announcement contains inside information for the purposes of the UK Market Abuse Regulation and the Directors of the Company are responsible for the release of this announcement.

Enquiries:

 
 Unigel Group plc 
 Eric Chhoa                                [phone] 
 Gary Revel-Chion                      [phone] 
 Cairn Financial Advisers LLP (AQSE 
  Corporate Adviser) 
 Jo Turner                             [phone] 
 Ludovico Lazzaretti 
 

Caution regarding forward looking statements

Certain statements in this announcement, are, or may be deemed to be, forward looking statements. Forward looking statements are identified by their use of terms and phrases such as "believe", "could", "should" "envisage", "estimate", "intend", "may", "plan", "potentially", "expect", "will" or the negative of those, variations or comparable expressions, including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors' current expectations and assumptions regarding the Company's future growth, results of operations, performance, future capital and other expenditures (including the amount, nature and sources of funding thereof), competitive advantages, business prospects and opportunities. Such forward looking statements reflect the Directors' current beliefs and assumptions and are based on information currently available to the Directors.

Notes to Editors

Unigel Group plc is the holding company whose operating subsidiaries, Unigel (UK) Limited ("Unigel") and Unitape Limited ("Unitape") manufacture and distribute materials used in the manufacture of telecommunication fibre optic cables.

Unigel, in which the Group has a 60.0% holding, formulates, manufactures, and markets thixotropic gels primarily to the fibre optic cable industry. In addition, it also makes specialty gel products for the construction, green energy, and high voltage transmission apparatus markets.

Unitape, a wholly owned subsidiary of the Group, is one of the largest domestic manufacturers and suppliers of laminated steel tapes to the fibre optic cable industry in North America.

CHAIRMAN'S STATEMENT

As I sat down this afternoon to write to you, I reflected upon the past three tumultuous years - how the pandemic had brought both challenges as well as opportunities to the business areas Unigel Group operates in. As a team, we emerged stronger and more resilient over the course of the pandemic. Group revenue in 2022 was GBP36.8 million compared to GBP16.1 million in 2019, representing an annual growth rate of 23.0 percent over the 3-year period.

Compared to financial year 2021, Group revenue grew 69.9 percent in 2022. Our thixotropic gel business and steel tape business chalked impressive growth of 22.8 percent and 133.0 percent respectively over the same period.

Our Group's Board members and management team have over 200 years of combined fiber optic cable and materials related business experience. Unigel Group's ability to remain agile, nimble, and flexible has assisted us to overcome the challenges in 2022: global logistic cost spikes, inflationary pressure, interest rate hikes, and a particularly strong Dollar. We overcame most of these challenges which helped us with an easier transition to a more normal business environment during the year in review. Even though the outbreak of the Ukraine conflict in early 2022 eliminated an important market in Russia for us-but over the course of the year-that shortfall was compensated with incremental business from other market areas.

Unigel Group's unique business model of shipping products from three manufacturing facilities in Europe, Asia and the US to our global customer base enabled us to continue with our delivery precision on an uninterrupted basis over the course of the difficult period of the pandemic. Our efforts brought unmatched supply chain security to our customers-and this has enhanced the trust and confidence that our customer base has placed on Unigel as their preferred supply partner. Thixotropic gel is a key component in the production of fiber optic cables, and Unigel supplies to all the leading fiber optic cable manufacturers globally. In 2022, our thixotropic gel business grew by 22.8 percent from the previous year, and this growth was contributed by both increased market share and the acquisition of new customers.

Our steel tape business in the USA has grown by leaps and bounds over the past five years. In 2022, we recorded a spectacular revenue growth of 133.0 percent over the preceding year, primarily from market share gain as well as demand growth. Since 2017, our steel tape business has grown 33.8 percent annually over the past 5 years. Building trust and growing our steel tape business in the USA requires considerable patience, hard work and demonstrated ability to meet the stringent demands of our major customers. We are happy to report that existing customers have given us more business, and we have been able to acquire new customers in the year under review.

In 2022 the global optical fiber cable industry-which is the key market that Unigel Group supplies to, grew by 12.6 percent across all markets, with most industry growth led by the markets in the US, South America, and Middle East. The continued deployment of mobile 5G and FTTH globally was a key driver in the demand for fiber optic cables. In addition, the acceleration of digitization across all facets of society continue to spur the demand for fiber optic cables and system.

At Unigel Group, we see substantial opportunities for us to grow organically and potentially through acquisitions and industry consolidation in the coming years. Our admission to AQUIS Stock Exchange is an integral step forward where we hope to continue to raise the profile of our businesses, access the capital markets, and create an acquisition currency to fund future growth in the years to come.

In 2023, our businesses continued to face headwinds and our outlook remains cautiously optimistic-inflation, increased interest rates and a potential recession in some of our key markets will keep us on our toes. I believe our highly competent and committed team are paying particular attention to improve cost and productivity, to streamline operations and bring more strategic planning to improve our future business competitiveness.

Throughout this unprecedented period, I saw the Unigel tradition and values guiding our actions towards our customers, business partners, employees and shareholders. We have strived to be a dependable and trusted business partner and a responsible corporate citizen. Despite all the gloomy economic conditions, 2022 was indeed a good year for Unigel Group. On behalf of my colleagues at the Board, I would like to express our gratitude to our shareholders for the continued support.

UNIGEL GROUP PLC

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

PERIODED 31 DECEMBER 2022

 
                                                                                                          2022 
                                                                                                           GBP 
 
 TURNOVER                                                                                           18,828,803 
 
 Cost of sale                                                                                     (16,602,974) 
                                           ------------------------------------------------------------------- 
 
 GROSS PROFIT                                                                                        2,225,829 
 
 Administrative expenses                                                                           (1,731,478) 
                                           ------------------------------------------------------------------- 
 
 OPERATING PROFIT                                                                                      494,351 
 
 Interest receivable and similar income                                                                 11,412 
 Interest payable and similar charges                                                                 (63,612) 
                                           ------------------------------------------------------------------- 
 
 PROFIT ON ORDINARY ACTIVITIES BEFORE 

  TAXATION                                                                                             442,151 
 
 
 
 Tax on profit on ordinary activities                                                                (118,604) 
                                           ------------------------------------------------------------------- 
 
 PROFIT FOR THE FINANCIAL PERIOD 
  FOR THE GROUP                                                                                        323,547 
 
 
 Other comprehensive income for the 
  period 
  Gain on foreign exchange                                                                              14,465 
  Negative goodwill on acquisition                                                                     666,205 
                                           ------------------------------------------------------------------- 
 
 TOTAL COMPREHENSIVE INCOME FOR THE 
  PERIOD                                                                                             1,004,217 
 
 Minority interest                                                                                      22,712 
                                           ------------------------------------------------------------------- 
 
  TOTAL COMPREHENSIVE INCOME FOR THE 
   GROUP                                                                                             1,026,929 
                                           =================================================================== 
 

UNIGEL GROUP PLC

CONSOLIDATED BALANCE SHEET

31 DECEMBER 2022

 
                                                 2022 
                                                  GBP 
 FIXED ASSETS 
 Intangible assets                            537,346 
 Tangible assets                            1,379,072 
                                          ----------- 
 
                                            1,916,418 
 
 CURRENT ASSETS 
 Stocks                                     8,757,545 
 Debtors                                    5,672,432 
 Cash at bank and in hand                     730,860 
                                          ----------- 
 
                                           15,160,837 
 CREDITORS 
 Amounts falling due within one year       14,440,267 
                                          ----------- 
 
 
 NET CURRENT ASSETS                           720,570 
                                          ----------- 
 
 TOTAL ASSETS LESS CURRENT LIABILITIES      2,636,988 
 
 CREDITORS 
 Amounts falling due after more than 
  one year                                     12,539 
 
 
 
 PROVISION FOR LIABILITIES 
 Deferred tax                                 300,519 
                                          ----------- 
 
 
 NET ASSETS                                 2,323,930 
                                          =========== 
 
 
 CAPITAL AND RESERVES 
 Called up share capital                       56,425 
 Share premium                                469,011 
 Profit and loss account                      806,929 
                                          ----------- 
 
 EQUITY ATTRIBUTABLE TO THE 
 OWNERS OF THE PARENT COMPANY               1,332,365 
 
 Minority interest                            991,565 
 
 
 SHAREHOLDERS' FUNDS                        2,323,930 
                                          =========== 
 

UNIGEL GROUP PLC

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

31 DECEMBER 2022

 
 Group                     Share   Share premium    Retained    Minority   Total equity 
                         capital                    earnings    interest 
                             GBP             GBP         GBP         GBP            GBP 
 Upon incorporation          100                                                    100 
 Upon issue of 
  shares net of 
  costs                   56,325         469,011                                525,336 
 Upon acquisitions                                   666,205   1,014,277      1,680,482 
 Comprehensive                                                                        - 
  income for the 
  period 
 Profit for the 
  period                                             323,547                    323,547 
 Minority interest 
  in profit/(loss) 
  for the period                                      22,712    (22,712)              - 
 Other comprehensive 
  income for the 
  period                                              14,465                     14,465 
 Dividends paid                                    (220,000)                  (220,000) 
 
 Total comprehensive 
  income for 
 the period 
  at 31 December 
  2022                    56,425         469,011     806,929     991,565      2,323,930 
                       =========  ==============  ==========  ==========  ============= 
 

UNIGEL GROUP PLC

CONSOLIDATED CASH FLOW STATEMENT

PERIODED 31 DECEMBER 2022

 
                                                       2022 
                                                        GBP 
 Net cash outflow from operating activities       (569,222) 
 Returns on investments and servicing 
  of finance                                       (62,872) 
 Taxation                                         (114,927) 
 Capital expenditure                              (129,043) 
                                                 ---------- 
                                                  (876,064) 
 Financing                                          953,839 
 Increase in cash in the period                      77,775 
                                                 ========== 
 
 
 Reconciliation of net cash flow to 
  movement in net debt 
 Increase in cash in the period                      77,775 
 Cash inflow from increase in debt                (428,403) 
                                                 ---------- 
 Change in net debt resulting from cash flows     (350,628) 
 Net cash upon acquisition                        (177,798) 
                                                 ---------- 
 Net cash at 31 December                          (528,426) 
                                                 ========== 
 

UNIGEL GROUP PLC

NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT

PERIODED 31 DECEMBER 2022

   1.    RECONCILIATION OF OPERATING PROFIT TO NET CASH INFLOW FROM OPERATING ACTIVITIES 
 
                                                      2022 
                                                       GBP 
 Operating profit                                  494,351 
 Depreciation and amortisation charges             114,412 
 (Profit)/loss on fixed asset disposals             24,442 
 (Increase) in stocks                          (3,382,187) 
 Decrease in debtors                             1,088,864 
 Increase in creditors                           1,090,896 
                                              ------------ 
 
 Net cash outflow from operating activities      (569,222) 
                                              ============ 
 
   2.    ANALYSIS OF CASH FLOWS FOR HEADINGS NETTED IN THE CASH FLOW STATEMENT 
 
                                                         2022 
                                                          GBP 
 Returns on investments and servicing of finance       29,328 
 Proceeds on sale of fixed assets                    (52,200) 
 Interest paid less interest received and similar 
  income                                             (40,000) 
                                                    --------- 
 Dividends paid 
 
 Net cash outflow for returns on investments 
  and servicing of finance                           (62,872) 
                                                    ========= 
 
 
 Capital expenditure 
 Purchase of intangible fixed assets           (7,012) 
 Purchase of tangible fixed assets           (122,031) 
                                            ---------- 
 
 Net cash outflow for capital expenditure    (129,043) 
 
 Financing 
 Proceeds from issue of shares                 525,436 
 (Loan repaid)/new loan received               428,403 
                                            ---------- 
 
 Net cash inflow from financing                953,839 
                                            ========== 
 
   3.    ANALYSIS OF CHANGES IN NET DEBT 
 
                               Upon acquisition   Cash flow   At 31/12/22 
                                            GBP         GBP           GBP 
 Net cash: 
 Cash at bank and in hand               653,085      77,775       730,860 
 
 Debt: 
 Loan                                 (830,883)   (428,403)   (1,259,286) 
                            -------------------  ----------  ------------ 
 
 Cash at bank and in hand             (177,798)   (350,628)     (528,426) 
                            ===================  ==========  ============ 
 

UNIGEL GROUP PLC

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

PERIODED 31 DECEMBER 2022

   1.    GENERAL INFORMATION 

The company is a public limited company incorporated in England and Wales (registered number 13934232) and its registered office is Unigel House, 7 Park View, Alder Close, Eastbourne, BN23 6QE.

The principal activity of the group is the manufacture and sale of cable filling and flooding compounds and associated pumping and delivery equipment.

The information above has been extracted from the Company's final report and accounts and therefore references to page numbers and notes may not be complete. Shareholders should read the full version of the final report for the period ended 31 December 2022 which is available on the Company's website, http://www.unigel.com .

   2.    ACCOUNTING POLICIES 

Accounting convention and basis of preparation

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the United Kingdom and the Republic of Ireland and the Companies Act 2006.

The preparation of the consolidated financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the group's accounting policies. Information is given in the accounting policies noted below.

Going concern

The group meets its working capital requirements through the receipt of revenue from global sales of cable filling and flooding compounds. Ultimately the receipt of revenue depends upon the availability of liquidity for the group's customers and the level of activity in the telecommunications market.

The directors prepare annual budgets and forecasts in order to ensure that they have sufficient liquidity in place for the business and have considered the effect on the group's business from different scenarios in various countries with which it trades. Based on this assessment, and having regard to the post year-end cash reserves and trading levels of the group, related party funding and the borrowing facility available from the group's bankers, the directors believe they have a reasonable expectation that the group will have adequate resources to continue to discharge its debts and liabilities as they fall due for the foreseeable future. The directors therefore consider it appropriate to continue to adopt the going concern basis of accounting in preparing the financial statements.

Basis of consolidation

The consolidated financial statements comprise the financial statements of the company and its subsidiary undertakings as at the balance sheet date. The financial statements of the subsidiaries are prepared to the same reporting date as the company. The subsidiaries are consolidated from the date of acquisition, being the date on which the group obtained control.

In preparing the consolidated financial statements, intra-group balances, transactions and unrealised gains or losses are eliminated in full.

   3.   DIVIDEND 

The Company has declared a final dividend of 2.5p per ordinary share, subject to shareholder approval at the Company's forthcoming AGM.

The ex-dividend date for the final dividend is 22 June 2023, the record date is 23 June 2023 and the expected payment date is on or around 31 July 2023.

   4.   AGM 

The AGM of the Company will be held on 29 June 2023 at 10:00 a.m. at the offices of Shakespeare Martineau LLP at 6th Floor, 60 Gracechurch Street, London, EC3V 0HR, United Kingdom.

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