ZTF Zotefoams Plc

TIDMZTF

RNS Number : 1870N

Zotefoams PLC

19 January 2023

Zotefoams plc

("Zotefoams" or "Group")

Full year trading update

Strong performance and record profits

19 January 2023 - Zotefoams, a world leader in cellular materials technology, today provides a trading update for the Group's financial year ended 31 December 2022 (unaudited).

The strong trading performance reported in the Group's update of 15 December 2022 continued through to the end of the year and, as a result, the Group expects to report full year revenue growth of 26%, to GBP127.4m (2021: GBP100.8m), which is ahead of current market expectations.

Full year trends for the specific Group's business units were as follows:

 
 --   29% growth in High Performance Product (HPP) sales to GBP54.5m 
       (2021: GBP42.3m): 
 
             *    Footwear sales grew by 25%, with continued momentum 
                  from new products and projects, representing 
                  approximately 33% of Group revenue 
 
             *    ZOTEK(R) fluoropolymer foam revenue increased by 48%, 
                  principally benefitting from the continued recovery 
                  of the aviation market 
 
             *    T-FIT(R) technical insulation sales grew 48%, 
                  overcoming continued COVID-related challenges in our 
                  manufacturing facility in China 
 --   25% growth in AZOTE(R) polyolefin sales to GBP70.1m (2021: 
       GBP56.2m): 
 
             *    Good performance from all regions with pricing 
                  actions recovering input cost inflation 
 
             *    Volume in line with the previous year, with increases 
                  experienced in most major geographical markets 
                  offsetting a 5% decline in continental Europe, 
                  primarily due to lower demand from the automotive 
                  segment 
 --   23% growth in MuCell Extrusion (MEL) sales to GBP2.8m (2021: 
       GBP2.3m), with increasing interest in the Group's technology 
       for polymer reduction. Development of the mono-material 
       ReZorce(R) packaging is progressing well and is currently 
       a significant focus of the team. 
 

Profit before tax for the year is now expected to be not less than GBP12.0m (2021: GBP7.0m), which is ahead of current market expectations and represents a year-on-year increase of over 70%. This record profit figure is net of the segment loss in the MEL Business Unit increasing to GBP1.9m (2021: GBP0.7m), which reflects the continued investment in the development of ReZorce packaging technology.

The Group demonstrated strong cash generation, with the year-end leverage multiple (net debt to EBITDA) expected to reduce to approximately 1.16x (2021: 2.06x).

Notice of results

The Company expects to publish its preliminary results for the year ended 31 December 2022 on Tuesday 21 March 2023.

Commenting on the update David Stirling, Group CEO of Zotefoams, said:

"We are delighted to close the year with very strong sales growth, delivering record profits and excellent cash generation. 2022 was characterised by uncertainty and our team has responded well in dealing with these challenges. The Group has delivered growth across all business units.

"We have also continued to invest in the development of ReZorce mono-material packaging which represents a significant commitment to new technology in the sustainability of consumer goods, in line with our own ESG and efficiency initiatives which remain a core focus.

"Whilst the shorter-term macroeconomic climate remains uncertain, we continue to monitor the evolving landscape closely and believe Zotefoams has a strong portfolio of opportunities, a clear strategy and is well positioned to deliver further growth."

Enquiries:

 
 Zotefoams plc                 +44 (0) 208 664 1600 
 David Stirling, Group CEO 
 Gary McGrath, Group CFO 
 
 IFC Advisory (Financial PR 
  & IR)                        +44 (0) 203 934 6630 
 Graham Herring 
  Tim Metcalfe 
  Zach Cohen 
 

About Zotefoams plc

Zotefoams plc (LSE - ZTF) is a world leader in cellular materials technology delivering optimal material solutions for the benefit of society. Utilising a variety of unique manufacturing processes, including environmentally friendly nitrogen expansion for lightweight AZOTE(R) polyolefin and ZOTEK(R) high-performance foams, Zotefoams sells to diverse markets worldwide. Zotefoams uses its own cellular materials to manufacture T-FIT(R) advanced insulation for demanding industrial markets. Zotefoams also owns and licenses patented microcellular foam technology to reduce plastic use in extrusion applications and for ReZorce(R) mono-material recyclable barrier packaging.

Zotefoams is headquartered in Croydon, UK, with additional manufacturing sites in Kentucky, USA and Brzeg, Poland (foam manufacture), Oklahoma, USA (foam products manufacture and conversion), Massachusetts, USA, Stilling, Denmark (microcellular foam technology) and Jiangsu Province, China (T-FIT).

www.zotefoams.com

AZOTE(R) , ZOTEK(R) , ReZorce(R) and T-FIT(R) are registered trademarks of Zotefoams plc.

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