TIDMESNT
RNS Number : 6891D
Essentra plc
21 October 2022
ESSENTRA PLC
("Essentra" or "the Company")
A leading global provider of essential components and
solutions
Q3 TRADING UPDATE
-- On a continuing operations basis(1) , the Group delivered Q3
revenue growth of 10.9% compared to prior year, on a like-for-like
("LFL") basis(2)
-- Continued success in mitigating inflationary pressure through
pricing, driving revenue growth and protecting profitability
-- The sale of Filters was announced in October, and remains on
track to complete no later than 31 January 2023
-- Strong balance sheet to pursue value creating organic and
inorganic opportunities post completion of the Packaging and
Filters transactions, and shareholder return of approximately
GBP150m
-- The FY 2022 adjusted operating profit remains in line with the Board's expectations
Financial and strategic highlights
The continuing business has delivered a good performance in Q3
2022, alongside a period of strong strategic and commercial
progress.
In October 2022, the Company announced the sale of the Filters
division to a wholly owned subsidiary of Centaury Management
Limited, the final major milestone in realising the strategic goal
of establishing a pure-play Components business, and positioning
Essentra as a leading manufacturer and distributor of components.
After completion of the Filters transaction and shareholder return,
it is the Board's intention for the Group to have a net financial
leverage of approximately 0x, providing the flexibility to pursue
value creating organic and inorganic opportunities, including
future bolt-on acquisitions.
The Components division delivered 10.9% LFL revenue growth
compared to Q3 2021 (+4.7% growth after adjusting for four more
trading days). The underlying business operations remain robust
amid toughening market headwinds in Q3 2022 and management remain
confident in the strength and resilience of the business model. New
price increases have been implemented in the quarter, with further
benefit expected in Q4 2022 as the business continues to
proactively monitor inflation.
Investing in the business remains a focus, and in September
Essentra opened a new purpose built European distribution hub in
Poland, expanding market presence and enhancing service to our
customers. The hub will service 20,000 product lines across Europe,
laying foundations for future growth.
The Group remains mindful of the more challenging economic
environment and continues to monitor headwinds, taking proactive
cost management actions where appropriate. Whilst slower economic
growth is expected in Q4, FY 2022 adjusted operating profit remains
in line with the Board's expectations. The Group's resilience is
supported by its breadth of customers, market categories and
geographies as well as a strong balance sheet.
Discontinued Operations
When reporting the FY22 results ending 31 December 2022, the
Packaging and Filters divisions will be accounted for as
discontinued operations. Packaging and Filters delivered Q3 growth
of 30.4% and 34.7% respectively, compared to the prior year versus
relatively weak comparatives.
Notes
(1) Continuing operations excludes the Filters division and the
Packaging division, which will be reported under IFRS 5 as a
discontinued operation at the FY 2022 results
(2) The term "like-for-like" adjusts for the impact of
acquisitions and foreign exchange
Enquiries
Essentra plc Tulchan Communications LLP
Jack Clarke, Chief Financial Officer Olivia Peters
Claire Goodman, Group Investor Relations Lisa Jarrett-Kerr
Manager Tel: +44 (0)20 7353 4200
Tel: +44 (0)1908 359100
Notes to Editors
About Essentra plc
Essentra plc is a FTSE 250 company and a leading global provider
of essential components and solutions. As a result of the
completion of the sale of Packaging to the Mayr-Melnhof Group, the
Group is now organised into two global divisions. Essentra focuses
on the light manufacture and distribution of high volume, enabling
components which serve customers in a wide variety of end-markets
and geographies.
Headquartered in the United Kingdom, Essentra's global network
extends to 32 countries and includes over 4,500 employees, 25
principal manufacturing facilities, 28 sales & distribution
operations and two research & development centres. For further
information, please visit www.essentraplc.com.
Essentra Components
Essentra Components is a global market leading manufacturer and
distributor of plastic injection moulded, vinyl dip moulded and
metal items. Operating in 25 countries worldwide, 13 manufacturing
facilities and 23 sales & distribution centres serve more than
79,000 customers with a rapid supply of low cost but essential
products for a variety of applications in industries such as
equipment manufacturing, automotive, fabrication, electronics and
construction. The division also includes the Reid Supply business,
which provides a wide range of branded hardware supplies to a broad
base of industrial customers, largely located in the US
Mid-West.
Essentra Filters
Essentra Filters is the only global independent cigarette filter
supplier. Currently headquartered in Singapore, the division has 12
sites across nine countries, including two innovation centres,
providing a flexible infrastructure strategically positioned to
serve the tobacco sector. The business supplies a wide range of
value-adding high-quality innovative filters, packaging solutions
to the roll your own segment and analytical laboratory services for
ingredient measurement to the industry. Essentra's offering also
includes Heat Not Burn and e-cigarette solutions to the rapidly
evolving market for Next Generation Products. The division also
includes the Tear Tapes business, which is globally recognised as
the leading manufacturer and supplier of pressure-sensitive tear
tapes, that are largely used in the tobacco, e-commerce, food and
beverage and specialist packaging sectors.
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END
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October 21, 2022 02:00 ET (06:00 GMT)
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