Autins Group plc (LON:AUTG), the UK and European based manufacturer of the patented Neptune melt-blown material and specialist in the design, manufacture and supply of acoustic and thermal insulation solutions, has announced its results for the six months ended 31 March 2021.
Financial Summary
· Revenue increased by 3.7% to £13.71m (H1 20: £13.22m)
· Gross profit increased by 1.8% to £3.91m (H1 20: £3.84m)
· Gross margins decreased by 0.5% to 28.5% (H1 20: 29.0%)
· EBITDA including IFRS 16 adjustments increased by 66.2% to £1.18m (H1 20: £0.71m)
· Adjusted EBITDA1 of £0.66m (H1 20: EBITDA of £0.27m)
· Profit after tax of £0.01m (H1 20: loss of £0.64m)
· Earnings per share of 0.025p (H1 20: loss of 1.62p)
· Operating cashflow increased to £0.87m (H1 20: £0.62m)
· Net debt2 excluding IFRS16 lease liabilities improved to £1.84m (H1 20: £2.34m)
1: EBITDA adjusted for IFRS 16, is stated on a consistent basis to H1 20. The H1 20 measure is therefore stated before adding back £0.16m of non-recurring costs in respect of the change in CFO.
2. Net debt is cash less bank overdrafts, loans, invoice discounting, hire purchase finance and right of use lease liabilities.
Operational Highlights
· Neptune sales continue to progress well with sales growing by 33%.
· 29 new projects won during H1 21, with on-going expected annual value of £3.9m.
· 46% of new business (£1.8m) has been won in Europe, 20% of all wins are in non-automotive applications.
· Germany sales grew by 81% to £3.9m (H1 20: £2.1m) with significant growth in the flooring business.
· OEM car production in H1 21 impacted initially by Covid-19 and latterly by global shortage of semi-conductors.
· Strong cash and working capital management actions have been taken. Cash and cash equivalents improved to £2.9m at the period end (H1 20 £1.9m) and cash headroom significantly improved to £6.1m (H1 20 £1.5m).
Post Period End
· Semi-conductor shortages continue to significantly suppress auto OEM production levels during Q3, despite the underlying growth in demand for new cars so that we expect H2 automotive revenue to be lower than H1.
· Neptune production continues to grow steadily with further new projects with DAF, Scania and office pods due to commence towards the end of the calendar year.
· The Company has engaged in constructive discussions with its lenders regarding covenant and headroom assessments. This has resulted in the Company securing a 3-year CBILS invoice finance extension facility with its primary bankers HSBC (which supports up to £0.47m of additional cash drawdown) and a waiver of the EBITDA covenant for 30th September 2021.
Gareth Kaminski-Cook, Chief Executive, said:
“I am pleased to report that sales across the Group are up 3.7% compared to H1 20 and EBITDA including IFRS 16 adjustments increased by 66% to £1.18m. Growth has been driven by market share growth in Europe and in non-automotive sectors of flooring and commercial vehicles.
During Q2 and Q3, our sales have been significantly impacted by the well-publicised semi-conductor supply issues. However, the strong underlying demand for cars and reassuring statements from semi-conductor manufacturers that they will begin to meet automotive demand during the summer suggests that we should start to see a recovery later this calendar year.
“In the meantime, we continue to successfully execute our strategy to diversify outside the UK and into new sectors. Sales in the flooring business more than doubled during H1 and by leveraging the unique qualities of our Neptune technology we have won 29 new projects in the first half, notably to supply new customers such as Volvo for the all-electric Polestar and Scania and DAF trucks in Sweden and Germany respectively.
“Despite the challenges posed to our auto customers by the global semi-conductor shortage and the likely impact on automotive revenues in H2, we remain positive on the outlook for the medium to long term.”
