Zotefoams plc (LON:ZTF), a world leader in cellular materials technology, has today provided a trading update for the four months ended 30 April 2022 ahead of its Annual General Meeting to be held today at 10am at 675 Mitcham Road, Croydon, CR9 3AL.
At this meeting Steve Good, Chair of Zotefoams plc, will make the following statement:
In line with the outlook statement in our 2021 preliminary results announcement, we have experienced good demand in the first four months of 2022, resulting in Group revenue for the period being approximately 13% ahead of the comparative period.
Highlights in the period are:
|•||Polyolefin Foams sales increased by 20%. Volumes have increased by 5%, with the majority of the sales uplift being driven by increased prices|
|•||High-Performance Products (HPP) sales increased by 6%:• Footwear sales at similar levels to prior period, as expected at this point in the demand cycle• Aviation sales improving strongly from a low base• T-FIT® insulation products sales increased by 18%|
|•||MuCell Extrusion’s focus is on the technical and commercial development of ReZorce® mono-material packaging solutions, with good progress in the period|
The macroeconomic environment remains difficult, with input cost inflation both significant and unpredictable and supply chains prone to disruption. We have been reacting to input-price movements by increasing our selling prices as well as focusing on internal efficiencies and controllable costs, while proactively implementing actions to mitigate supply chain risks. There has been no material disruption to the Footwear supply chain or to our major facilities in the UK, USA and Poland, although there was a 5-week enforced shutdown of our China T-FIT facility due to COVID-19.
We have delivered good sales growth in the first four months of the year and anticipate this sales momentum to continue, supported by the price increases and a strong order book with excellent visibility to the end of June. However, we do not anticipate the challenging macroeconomic environment to ease and remain mindful of some specific risks around COVID-19.
While it is still early in the year, we anticipate Group revenue to be ahead of market expectations for the full year, with demand in line and higher prices recovering cost inflation. Current foreign exchange rates, net of hedging, may also provide some additional benefit. Consequently, we are comfortable with expectations for growth in profit and remain confident about the long-term prospects of the business.
Commenting on the update David Stirling, Group CEO of Zotefoams, said:
“Zotefoams products are well positioned to deliver benefits to society by saving energy, protecting people and goods and helping our customers make their products using less raw material. We have invested significantly in recycling initiatives with ReZorce barrier packaging and in our core foams business, and we are well placed for future growth. The current macroeconomic climate is extremely challenging and I am proud of our team for balancing customer expectations with the cost inflation and supply chain pressures we face as a business.