TIDMZTF
RNS Number : 3774M
Zotefoams PLC
21 January 2021
Zotefoams plc
("Zotefoams" or "Group")
Operational and Trading Update
21 January 2021 - Zotefoams, a world leader in cellular
materials technology, today provides a trading update for the
Group's financial year ended 31 December 2020 (unaudited) ahead of
the publication of its preliminary results on Tuesday 23 March
2021.
Zotefoams is pleased to report that the strong second half
trading momentum highlighted at the time of the Group's third
quarter update was maintained for the remainder of the year,
resulting in record six-months sales and more than reversing the
decline in the first half. As a result, full year Group revenue was
slightly above that of the previous year, in line with current
market expectations. Full year trends for the specific business
units were as follows:
-- HPP sales increased by over 10%
o Footwear sales grew in excess of 65%, with strong momentum
from new products and projects in the second half, and now
represent approximately 25% of Group revenue;
o ZOTEK(R) fluoropolymer foam revenue, where the main market is
aviation, declined by approximately 50%;
o T-FIT(R) technical insulation sales grew modestly, despite
encouraging levels of demand, with COVID-related delays in India
negatively impacting growth versus our expectations in the
period;
-- AZOTE(R) polyolefin sales were in line with the previous
year. The business experienced a decline of approximately 20% in
sales to its traditional markets, which are mainly in industrial
applications, although there was notable recovery in demand from
these sectors in the fourth quarter. This decline was offset by
project-related PPE sales to UK Government programmes which ended
late in the year, as expected;
-- MuCell Extrusion sales declined by over 40%, mainly in
equipment, impacted by the travel restrictions imposed by COVID-19
and a refocus of management time towards its ReZorce(R)
mono-material barrier packaging technology . During 2020, the Group
has further progressed the development of the ReZorce product.
Whilst the improving backdrop in the second half has enabled the
Group to begin reinstating investment into its long-term growth
drivers, operational performance has been strong and, consequently,
adjusted profit before tax and exceptional items for the year
ending 31 December 2020 is anticipated to be at the top end of
market expectations. Alongside this, solid cash generation has
returned the leverage ratio (net debt to EBITDA) closer to 2x.
Commissioning of Zotefoams' third foam manufacturing factory, in
Poland, is expected early in February. Delivered on budget, but
purposely delayed due to lower demand caused by COVID-19, this
facility completes the planned spending on major capital projects,
increases Group capacity and is well-positioned to generate and
support demand growth.
Commenting on the update David Stirling, Group CEO of Zotefoams,
said:
"We are pleased to report robust figures in what have been very
challenging conditions. The Group has demonstrated not only the
breadth and resilience in demand for the Group's differentiated
technology, but also the organisation's flexibility to realign
commercial and operational activity quickly and effectively. As a
result, we have successfully managed to grow sales, provide
operational continuity for our customers and retain a strong
financial position.
"The adverse impact of COVID-19 encountered during 2020 across
most markets, as well as the risk of operational disruption, will
continue into the current year, although I believe Zotefoams is
well positioned to address these challenges. Our focus on the
health and safety of employees globally and all visitors to our
sites is our priority and continues to be delivered through
well-established procedures.
"We have been encouraged by the recovery momentum in the general
industrial markets for AZOTE(R) foams through the end of 2020 and,
whilst sales to PPE applications are expected to be minimal in the
current year, this positive momentum, alongside the continuing
structural growth in HPP segments such as footwear and T-FIT(R)
technical insulation, provides a strong platform for progress in
2021.
"With tariff-free trading, the outcome from Brexit negotiations
has been as good as we might have expected, although delays at
ports are currently reducing transport availability and causing
what we believe will be short-term disruptions to our business.
"Whilst the macroeconomic climate remains uncertain and
challenging, we believe Zotefoams has a strong portfolio of
opportunities, a clear strategy and is well-invested in capacity to
deliver 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 and Oklahoma, USA (foam products
manufacture and conversion), Massachusetts, USA (MuCell Extrusion)
and Jiangsu Province, China (T-FIT (R) ). A third foam
manufacturing site, in Poland, is planned to begin operations early
in 2021.
www.zotefoams.com
AZOTE (R) , ZOTEK (R) , ReZorce (R) and T-FIT (R) are registered
trademarks of Zotefoams plc.
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 rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
TSTSEIFWSEFSEEF
(END) Dow Jones Newswires
January 21, 2021 02:00 ET (07:00 GMT)
Zotefoams (LSE:ZTF)
Historical Stock Chart
From Mar 2024 to Apr 2024
Zotefoams (LSE:ZTF)
Historical Stock Chart
From Apr 2023 to Apr 2024