IG Design Group Plc - Full Year Results
IG Design Group PLC
Results for the year ended 31 March 2019
Organic and acquisitive growth drives record revenue and profits alongside 42% increased dividend
IG Design Group plc, one of the world's leading designers, innovators and manufacturers of Gift Packaging, Celebrations, Stationery and Creative Play products, Giftware and related product categories announces its results for the year ended 31 March 2019.
· Revenue up 37% to £448.4 million (2018: £327.5 million), with 9.8% organic growth
· Adjusted operating profit* increased by 41% to £ 32.6 million (2018: £23.2 million)
- Adjusted operating margin* is up 0.2 percentage points to 7.3% (2018: 7.1%)
· Adjusted profit before tax* up 39% to £30.3 million (2017: £21.8million)
· Adjusted earnings per share* up 33% to 29.3p (2018: 22.1p)
· Adjusted cash generated from operations £50.5 million (2018: £22.6 million) funding capital expenditure of £7.9 million (2018: £9.4 million)
· Average leverage* improved to 1.3 times (2018: 1.5 times) with year-end net cash balance up £12.7 million to £17.1 million (2018: £4.4 million)
· Final dividend per share increased by 50% to 6.00p (2018: 4.00p), delivering total dividend in respect of the year of 8.50p per share up 42% (2018: 6.00p). Dividend cover is 3.4 times.
*(stated before exceptional items, amortisation of acquired intangibles and LTIP charges)
· As a result of exceptional costs of £8.4 million, primarily related to the acquisition of Impact Innovation, Inc. ("Impact") and the subsequent restructuring in the US, profit before tax decreased to £17.3 million (2018: £19.7 million), in line with market guidance
· Fully diluted earnings per share 16.0p (2018: 20.5p)
· All regions delivered sales and profit growth
- Outstanding performance in USA, Europe and Australia with on-going growth in the UK
· Continued geographic and customer diversification:
- With growth in all regions, revenues by destination outside of the UK are at 78% (2018: 73%), with 22% remaining UK based.
- Traded with in excess of 11,000 customers, with more than 750 million units of consumer products sold in over 210,000 stores across 80 countries.
· Strategic growth projects successfully executed in all regions:
- Acquisition of Impact in USA in August 2018. Operational synergies delivering to plan
- Doubling of revenues of 'not-for-resale' consumable products globally to £20 million, including UK manufactured paper bags
- 24% increase to £197 million in sales of non-Christmas merchandise, including significant growth in the sale of Creative Play products
- Successful initial phase upgrade of IT systems in USA
· New increased banking facility agreed supporting future growth, both organic and M&A
Paul Fineman, CEO, commented:
"We have generated sales of more than 750 million units of consumer products across over 50,000 individually designed items. This tremendous level of innovation, together with our ability to manage and leverage considerable scale, has resulted in our business meeting ambitious targets and achieving record revenues, profit, cash generation and EPS. As a consequence, we have significantly enhanced our full year dividend up 42% to 8.50p.
Having successfully concluded, in August 2018, the acquisition of Impact in the USA, I am particularly pleased that we have 'hit the ground running' in terms of delivering on our plans for operational and commercial synergies that were identified at the time of the acquisition; an excellent example of collaboration and team work amongst our new and enlarged team in the US.
As ever, our eye is on the future and we continue to invest to enhance our competitive advantage. We have delivered £7.9 million of capital expenditure projects within the year and have additional exciting fast payback investments taking place in 2020. Furthermore, our investment in our team continues at pace with the focus on leveraging scale and driving innovation.
Supported by an ever strengthening balance sheet, our business remains very well placed to continue to grow both organically and through carefully considered M&A opportunities and we look forward to the future with enthusiasm and optimism."