TIDMVCT
RNS Number : 5987R
Victrex PLC
07 July 2022
7 July 2022
Victrex plc - Q3 Interim Management Statement
Continuing strong growth, revenue up 16% & volume up 10%
with improved pricing
A record quarter - on track for full year expectations
Victrex plc is an innovative world leader in high performance
polymer solutions, delivering sustainable products which support
CO2 reduction and bring environmental and societal benefit in
multiple end-markets. Today's Interim Management Statement for Q3
covers the period 1 April 2022 to 30 June 2022.
Overall, the Group is seeing continuing strong growth across the
majority of its end markets, including a record quarterly volume
during Q3 to reflect a healthy core business, and good progress on
milestones within its 'mega-programme' growth pipeline:
-- Q3 Group revenue was up 16% to GBP93.4m (Q3 2021: GBP80.7m)
-- Q3 Group volume was up 10% to 1,323 tonnes (Q3 2021: 1,202 tonnes)
-- Year to date Group revenue of GBP253.5m is 9% ahead of the
prior year (2021 YTD: GBP231.6m), with YTD Group volume of 3,586
tonnes being 9% ahead of the prior year (2021 YTD: 3,289
tonnes)
-- Q3 benefiting from price increases, with improved average
selling prices (ASP), to help offset unprecedented energy and raw
material costs - mindful of ongoing inflationary environment
-- Strong progress on PEEK Knee clinical trial, with 22 patient
implants and 6 patients passing the 12-month stage with no
intervention. Closing in on a partner agreement with a top 5 Knee
company
-- 510k regulatory approval in the US for a Trauma plate based
on our PEEK composite materials, as part of our partnership with
In2Bones
-- Advanced discussions for partnership in Trauma, to support
further scale up and commercialisation
-- Partnering with Jaguar Land Rover (JLR), industry players and
academia on Project Virbius (E-mobility) to build on recent new
business wins
End market performance
Across our end-markets, Value Added Resellers (VAR), Electronics
and Energy & Industrial continue to be the main growth drivers,
with double-digit improvement. Growth was held back by Automotive,
where performance continues to be variable, reflecting the ongoing
semiconductor chip shortages in this industry. In Aerospace, build
rate increases from the major manufacturers towards the end of 2022
should support continued recovery.
In Medical, despite a temporary headwind from COVID-19 lockdowns
in China during the earlier part of Q3, we saw solid growth, with
performance being broad based across Asia-Pacific and the US. We
also secured our first regulatory clearance in China for
PEEK-OPTIMA(TM) HA Enhanced (Spine) to support
commercialisation.
Inflation recovery & pricing
Pricing improved across end markets compared to Q2, with the
blended average selling price (ASP) also being ahead of the
previous quarter and the prior year.
Financial position
Victrex retains a highly cash generative business model, with
our cash position supporting the elevated capital expenditure this
year, principally in our China manufacturing investments, with our
new PEEK polymer facility set to start commissioning during the
final quarter. Cash on 30 June 2022 was GBP50m, which excludes
GBP3.6m cash ringfenced in China investments. Capital expenditure
for the year is now expected to be slightly lower than our prior
guidance, at approximately GBP50m, reflecting some expenditure
phased into FY 2023.
Outlook
Jakob Sigurdsson, Chief Executive of Victrex, said: "This is
another strong performance by Victrex, with a healthy core
business, good growth in new applications and further milestones in
our mega-programmes, particularly in Medical as we look for this
business to become a larger part of our long-term revenues. Despite
our sales mix, where VAR, Electronics and Energy & Industrial
drove most of the volume growth, we are starting to see the benefit
of price increases to help recover the unprecedented increase in
energy and raw material costs.
"Although historic run-rates typically see a slight step down
during our final quarter, our order book is robust and, overall,
this is expected to be a year of record volumes for Victrex. Whilst
we are mindful of uncertainty in the global economic outlook, we
remain on track for delivering full year expectations.
"With sustainable products bringing environmental and societal
benefits, a balanced portfolio of end markets in our core business,
a strong pipeline of growth opportunities, and a highly cash
generative business model, our Polymer & Parts strategy keeps
us well positioned for the medium to long-term."
Victrex will report its Preliminary Results for 2022 on Tuesday
6(th) December 2022.
Analyst & investor conference call
A conference call with management will take place this morning,
Thursday 7(th) July, at 0830am BST, which can be accessed by
registering at the following link:
https://cossprereg.btci.com/prereg/key.process?key=PNRVEG6YA
Enquiries:
Victrex plc:
Andrew Hanson, Director of Investor Relations, Corporate
Communications & ESG +44 (0) 7809 595831
Jakob Sigurdsson, Chief Executive
+44 (0) 1253 897700
Ian Melling, Chief Financial Officer +44 (0) 1253 897700
About Victrex:
Victrex is an innovative world leader in high performance
polymer solutions, focused on the strategic markets of Automotive,
Aerospace, Energy & Industrial, Electronics and Medical. Every
day, millions of people rely on products or applications which
contain our sustainable materials, from smartphones, aeroplanes and
cars to oil & gas operations and medical devices. With over 40
years' experience, we are moving beyond the polymer into
semi-finished and finished products which shape future performance
for our customers and our markets, provide environmental and
societal benefit for customers and drive value for our
shareholders. Find out more at www.victrexplc.com
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