Luceco PLC Full Year Trading Update (0715B)

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RNS Number : 0715B

Luceco PLC

28 January 2020

Luceco plc

28 January 2020

Full Year Trading Update

2019 & 2020 profits expected to be ahead of market expectations

Luceco plc (the "Group" or "Luceco"), today announces its trading update for the year ended 31 December 2019. Luceco is a leading manufacturer and distributor of high quality and innovative wiring accessories, LED lighting and portable power products for a global customer base.

Highlights

   --       2019 Revenue of GBP172.0m (2018: GBP163.9m): 

o Revenue growth of 4.9%.

o Slower growth in H2 2019 as expected reflecting tougher comparatives and more hesitant UK demand caused by political & economic uncertainty.

o Healthy growth overseas, particularly in Europe.

-- 2019 Adjusted Operating Profit expected to be in the range of GBP17.5m to GBP18.0m (2018: GBP8.5m):

o Strong profit growth in H2 2019 from further gross margin expansion and diligent control of overheads.

o 2019 Adjusted Operating Margin in the range of 10.2% to 10.5% (2018: 5.2%).

   --      Strong cash conversion: 

o 2019 Adjusted Free Cash Flow of approximately GBP18.0m (2018: GBP7.7m).

o Closing net debt of approximately 1.0x Adjusted LTM EBITDA (2018: 2.2(1) x), comfortably at the lower end of the Group's targeted range of 1.0 - 2.0x.

   --      Confident of further improvement in performance in 2020: 

o Expect 2020 Adjusted Operating Profit in the range of GBP20.5m to GBP21.5m.

   --      2019 full year results to be announced on 31 March 2020. 

John Hornby, Chief Executive Officer, said:

"The Group has made strong progress on a number of fronts in 2019 thanks to the hard work and dedication of the entire Luceco team. Our continued focus on margin expansion and cash generation against the backdrop of tough UK market conditions has more than doubled the Group's profits and halved the Group's leverage in 2019. A more certain UK political environment should yield better market conditions in 2020, but we are not building this into our expectations for the year at this stage. We are confident that the actions we are taking to expand our profitability will contribute to another improved performance in 2020."

(1) Including the impact of IFRS 16 adoption

Supporting note:

The Board considers market expectations are best defined by taking the range of forecasts published by analysts who consistently follow the Group. The average of the Adjusted Operating Profit forecasts at 28 January 2020 is as follows: 2019: GBP17.3m and 2020: GBP19.4m.

Further enquiries:

For further information, please contact:

 
Luceco plc                              via MHP Communications 
 John Hornby, Chief Executive Officer    020 3128 8572 
 Matt Webb, Chief Financial Officer 
MHP Communications 
 Tim Rowntree 
 Ollie Hoare                            020 3128 8572 
 

Business summary

Luceco is a manufacturer and distributor of high quality and innovative wiring accessories, LED lighting and

portable power products 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:

-- British General ("BG"): wiring accessories (including switches, sockets), circuit protection and cable

management products;

-- Luceco and Kingfisher Lighting: energy efficient LED lighting products and associated accessories;

-- Masterplug: cable reels, extension leads, surge protection, timers and adaptor products; and

   --      Ross: television wall mounts, audio visual accessories and other items. 

Luceco's long-established BG brand commands a loyal following amongst professional electrical contractors

in both the UK and overseas. It is synonymous with quality, safety, innovation and value for money. The

production of BG wiring accessories is the main focus of the Group's Chinese manufacturing facility, allowing

it to control product quality, cost and availability.

The Luceco and Kingfisher LED lighting brands combine to present a comprehensive range of indoor and

outdoor LED lighting solutions. The range focuses largely on professionally installed products with an

emphasis on performance and quality. The Group is able to support these products by offering customers

access to its in-house installation design team.

Masterplug is the market leading brand in the UK Portable Power category. It is sold largely to consumers

through retail distribution and online. Its products are offered in a wide range of global electrical standards

and they are sold in every territory in which the Group operates.

Forward-looking statements

This announcement contains forward-looking statements that are subject to risk factors associated with,

among other things, the economic and business circumstances occurring from time to time in the countries,

sectors and markets in which the Group operates. It is believed that the expectations reflected in these

statements are reasonable, but they may be affected by a wide range of variables which could cause actual

results to differ materially from those currently anticipated. No assurances can be given that the

forward-looking statements in this announcement will be realised.

The forward-looking statements reflect the knowledge and information available at the date of preparation of

this announcement and the Company has no obligation to update these forward-looking statements. Nothing in this announcement should be construed as a profit forecast.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [e-mail] or visit www.rns.com.

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January 28, 2020 02:00 ET (07:00 GMT)