FireAngel SafetyTech - Trading Update
Over the past 18 months, the Company has been realising its strategy to transition into an independent technology-led business in order to deliver connected solutions that complement its core product range with an extended 'connected home' product set.
As announced in its interim results announcement in September 2018, the Group has been working alongside its manufacturing partner to fully optimise production levels, which are now delivering increased monthly product output in line with its forecast needs. However, the extended time to optimise production has impacted delivery of certain high margin products and added short-term costs.
In addition, core product sales within the Company's UK retail and German trade segments have only recently, during Q4 2018, recovered to acceptable levels and are expected to provide further positive momentum in 2019.
As a result, the Board now expects the Company's results for the year ending 31 December 2018 to be materially below market expectations.
Despite the Company's disappointing performance in the current financial year, an increasing pipeline of opportunities continues to build for 2019.
Scottish legislation which has been delayed by three months is now expected to be introduced during H1 2019. This new legislation which requires the retro installation of connected smoke and heat alarms and a CO detector into all domestic properties in Scotland is expected to deliver incremental sales growth in 2019. Core product sales in UK retail continue to recover, both through traditional retailers and with growth through digital channels. In addition, German trade sales have also started to recover during Q4 2018 which will provide further momentum in 2019. The Group has also made good progress with the recent contract wins with both Mears and St Leger Homes, further enhancing its UK Trade opportunities.
A number of other large connected proposition tenders and legislation driven opportunities are now expected to make a positive impact during the first half of 2019 thereby underpinning the Board's expected recovery to profitability in line with market expectations.
The Board also remains confident that the Group's ongoing transition from a hardware safety products provider to a more integrated safety solutions provider will underpin medium to longer term expectations.
About FireAngel Safety Technology Group plc ("FireAngel")
FireAngel's mission is to protect, save and improve our customers' lives by making innovative, leading edge technology simple and accessible. FireAngel is one of the market leaders in the European home safety products market and launched its own connected homes product proposition at the end of 2016.
FireAngel's principal products are smoke alarms, CO alarms and accessories. The Company has an extensive portfolio of patented intellectual property in Europe, the US and other selected territories. Products are sold under FireAngel's leading brands of FireAngel, FireAngel Pro, AngelEye and FireAngel Connect.