McBride plc
Trading Update
McBride plc (the “Group”), the leading European manufacturer and supplier of Contract Manufactured and Private Label products for the domestic Household and professional cleaning and hygiene markets, today provides a trading update for the six months ended 31 December 2019.
The Group's first half Household revenues at constant currency were 1.4% lower compared to the prior year following a slowdown in the last two months of the period, especially in the UK. H1 UK revenues were 8.0% lower year on year, reflecting weaker Private Label activity in the period. Our South, East and Asian geographies performed well in the half year, reporting growth versus the prior year of 15.7%, 1.6% and 10.7% respectively. France and North continued to see declines versus the prior year (6.8% and 3.7% respectively), consistent with the second half of the last financial year.
Reflecting the first half performance, our expectations for the rest of the year are reduced and we now expect full year Household revenues to decline by approximately 2% year on year.
Reflecting the decision to exit UK Aerosol manufacture in the fourth quarter of the previous financial year, Group continuing revenues at constant currency were down 4.4% versus the prior year.
During the first half year, raw material and packaging costs remained largely stable and in line with our expectations. Logistics costs as a percentage of revenues continued to increase, reflecting the higher distribution costs associated with our growing business in Germany. Cost improvement initiatives continue across the Group and these are expected to show increased benefits in the second half year. In the absence of significant raw material cost changes, the Board now expects full year adjusted PBT to be approximately 15% lower than current market expectations(*) reflecting the impact of lower revenues.
Net debt closed the period at £113.5m (30 June 2019: £120.9m) excluding the effect of IFRS 16. The Group remains comfortably within all of its banking covenants. The Group will confirm its final Net Debt balance for the period ending 31 December 2019, including IFRS 16, at the time of its interim results announcement.
Following the appointment of Ludwig de Mot as CEO on the 1 November 2019 the Group has initiated a review of its strategy and operations which it expects to report on during the fourth quarter of this financial year.
The Group's interim results will be announced on 20 February 2020.