Victrex plc – Preliminary Results 2018

Highlights:

–      Strong core business* growth

–    Group sales volumes up 10% driven by core growth & mega-programme progress

–    Group revenue up 12%; constant currency revenue** up 7%

–    Strong performances across Industrial markets; Medical revenue up 3%

–    Profit before tax (PBT) up 15%, supported by currency

–    Further progress in 'mega-programmes'

–    Major Dental supply agreement with Straumann and new Trauma collaboration

–    PEEK Gears now “on the road” & further larger opportunities

–    Strong performance in Magma following planned deployments & further opportunities

–    TxV Aero Composites facility in commissioning; new Aerospace alliances under discussion

–    Clinical trial submitted for PEEK Knee programme

–    Continued strong cash generation, supporting investment & shareholder return

–    Operating cash conversion** of 107% giving cash available** up 20% to £144.4m

–    Regular dividend up 11% to 59.56p/share and special dividend of 82.68p/share

–    Dividend distribution policy retained, balancing investment flexibility & shareholder return

Jakob Sigurdsson, Chief Executive of Victrex, said: “This has been a strong year for Victrex, with broad based growth in our core polymer business and further good progress in our new product pipeline.  We delivered a range of notable milestones across each of our mega-programmes and we are currently closing in on larger opportunities in Gears, as well as being in advanced discussions for new strategic Aerospace alliances.

“After my first year as CEO, it's clear that moving downstream through our Polymer & Parts strategy will further differentiate Victrex in a competitive market and enable us to capture our long-term growth opportunities. We will continue to invest in support of future growth, as well as reviewing partnership and acquisition opportunities. Strong cash generation continues to offer the opportunity of attractive returns to shareholders and we are today announcing a special dividend of 82.68p, whilst retaining the current dividend distribution policy, thereby balancing investment for growth with shareholder return. 

“For 2019, our expectation is for continued momentum in our core polymer business and milestones in our mega-programmes.  We expect to make good progress on a constant currency basis, however, adverse currency, no expected volumes in Consumer Electronics and recent market softness in Automotive may hold back our ability to substantially improve on our overall 2018 performance, with these headwinds falling mainly in the first half.  A better second half, compared to the prior year, is our current assessment and with strong structural growth opportunities and a healthy new product pipeline, we continue to be well-placed for the medium and long term.”

Outlook

For 2019, our expectation is for continued momentum in our core polymer business and milestones in our mega-programmes.  We expect to make good progress on a constant currency basis, however, adverse currency, no expected volumes in Consumer Electronics and recent market softness in Automotive may hold back our ability to substantially improve on our overall 2018 performance, with these headwinds falling mainly in the first half.  A better second half, compared to the prior year, is our current assessment and with strong structural growth opportunities and a healthy new product pipeline, we continue to be well-placed for the medium and long term.

About Victrex:

Victrex is an innovative world leader in high performance polymer solutions, focused on the strategic markets of automotive, aerospace, energy (including manufacturing & engineering), electronics and medical.Every day, millions of people use products and applications which contain our materials – from smartphones, aeroplanes and cars to oil and gas operations and medical devices. With over 40 years' experience, we develop world leading solutions in PEEK and PAEK based polymers, semi-finished and finished parts which shape future performance for our customers and our markets, and drive value for our shareholders. Find out more at www.victrexplc.com or follow us on LinkedIn and Twitter @victrexir