TIDMIGR
RNS Number : 4498J
IG Design Group PLC
27 April 2022
27 April 2022
IG Design Group plc
("Design Group", the "Company" or the "Group")
Post Close Trading Update
IG Design Group plc, one of the world's leading designers,
innovators and manufacturers of celebrations, craft, gifting,
stationery and creative play products, today issues a post close
trading update for the year ended 31 March 2022.
The Group has delivered a strong revenue performance for the
year at $963 million, up 10% like-for-like year on year and up 6%
on proforma FY20 sales. The International business grew 15% with
increases across all regions and particular strength in Europe and
Australia. The Americas business was up 7%, reflecting growth in
Celebrations and Gifting offset by lower year on year Craft sales.
This performance reflects the Group's continued delivery of high
service levels to its customers despite the challenging
macroeconomic supply chain issues.
Group operating margin is expected to be 0.5% delivering Group
operating profit(1) marginally ahead of previously communicated
expectations, reflecting a stronger than anticipated performance in
the USA. The Group expects to report a small adjusted loss before
tax(1) for the year.
As a result of the lower than previously expected future
earnings in the USA, the Group will book in FY22 a non-cash
one-time reversal of deferred tax assets, meaning that adjusted
post-tax losses and adjusted loss per share are expected to be
significantly below market expectations.
Financial position
The Group closed the year with a net cash balance of $30
million, down year on year reflecting inventory-related working
capital absorption. This relates to the Group's response to
continuing supply chain challenges, which have required raw
material purchases to be brought forward to support the strong
seasonal orderbook and the inflationary impact on the cost of
inventory.
The Group is in the process of finalising a facility waiver
amendment in anticipation of the 2022 seasonal working capital
requirements and an extension to March 2024 of the existing banking
arrangements which run currently to June 2023. It is expected that
these will be completed in the near term.
Board appointments
The Board was pleased to recently announce the appointment of
Paul Bal as Group CFO and looks forward to his arrival on 3 May
2022. He will join Lance Burn, Interim Group COO, in leading the
business on a day-to-day basis. We are also pleased to announce the
appointment of Claire Binyon to the Board as a Non-Executive
Director, effective from 1 June 2022 (please refer to the separate
announcement).
The search for the Group CEO is underway and in the interim
period the Company is pleased to announce that Stewart Gilliland
has agreed to step into the role of Interim Executive Chair from
June 2022 to December 2022, further bolstering the executive team
capacity.
USA strategy
In the USA, the team are focused on delivering three key
priorities to drive an improvement in the financial performance of
the business which is expected to return the USA back to an
operating margin of c.5-6% by FY25:
i) balancing customer pricing to supply chain cost inflation
ii) driving immediate and longer term cost savings
iii) addressing the commercial proposition to align the product
offering to the new price:cost environment by simplifying the
commercial architecture, driving margin and reducing
inventories.
The business has had good success in mitigating a significant
proportion of the ongoing cost pressures through discussions with
customers. Progress has also been achieved including a
restructuring of the US commercial, manufacturing and supply chain
operations, which while removing costs also better aligns and
accelerates decision making and improves accountability. In
addition, operational cost savings have been implemented reducing
external storage and freight handling expenditure while also
ensuring in-house manufacturing is well prepared for the
forthcoming season.
Outlook
The Group expects to deliver a marginal operating profit
improvement in FY23, which reflects the progress being made in the
USA, with the adjusted loss before tax expected to be broadly flat
on the Group's FY22 results, driven primarily by increased finance
charges in the year ahead. Average debt of the Group is expected to
increase to c.$75-$80 million across the 12 months to 31 March
2023, compared to c.$15m in FY22 reflecting the expected higher
working capital requirements of the Group throughout FY23.
The Board expects FY23 to continue to present external supply
chain challenges bringing uncertainty across the Group, however,
customer demand remains strong, particularly in relation to our
important contracted seasonal orderbook.
The Group expects to announce its full year results on 28 June
2022.
Stewart Gilliland, Chair, commented:
"It has been a challenging FY22 with the business weathering
significant cost headwinds but delivering good revenue growth and
fantastic service to our customers. There is no doubt that the
ongoing external supply chain and geo-political situation creates
uncertainty in the retail consumer goods sector, however the work
that is being undertaken in the US, and across all regions,
positions the Group well to mitigate these challenges and provides
the foundations for a far more positive longer term outlook for the
Group.
Notwithstanding the difficulties faced, the Group's leading
position in the market remains unchanged. We continue to work
collaboratively with our customers to efficiently advance our
manufacturing and product sourcing, ensuring we deliver exceptional
product and service. I am confident the Group will return to
profitable growth, and I look forward to providing further insight
into the strategic plans in the USA and across the whole Group at
the full year results announcement in June."
(1) Now includes the credit/(charge) relating to share based
incentives.
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU No. 596/2014) which is part of UK law by virtue of
the European Union (withdrawal) Act 2018. Upon the publication of
this announcement, this inside information is now considered to be
in the public domain.
For further information, please contact:
IG Design Group plc Tel: 0152 588
7310
Stewart Gilliland, Chair
Giles Willits, Chief Financial Officer
Canaccord Genuity Limited (Nominated Adviser Tel: 0207 523
and Broker) 8000
Bobbie Hilliam, NOMAD
Alex Aylen, Sales
Alma PR Tel: 0203 405
0205
Susie Hudson
Sam Modlin
Rebecca Sanders-Hewett
About IG Design Group plc
IG Design Group plc, the largest consumer gift packaging
business in the world, is a designer, innovator and manufacturer of
products that help people celebrate life's special occasions.
Design Group works with more than 11,000 customers in over 80
countries throughout the UK, Europe, Australia and the USA.
Its products are found in over 210,000 retail outlets, including
several of the world's biggest retailers, for example Walmart,
Target, Amazon, Costco, Lidl and Aldi. Its brand, Tom Smith, also
holds the Royal Warrant for the supply of Christmas crackers and
Christmas wrapping paper to the Royal family. Design Group is a
diverse business operating across multiple regions, categories,
seasons and brands.
Its five major product categories are: Celebrations, Gifting,
Craft & creative play, Stationery and 'Not-for-resale'
consumables. It offers customers a full end-to-end service from
design through to distribution, offering both branded and bespoke
products from the value-focused through to the higher-margin ends
of the market.
The Company was admitted to the Alternative Investment Market of
the London Stock Exchange in 1995 under the name 'International
Greetings plc' and rebranded to IG Design Group plc in 2016. For
further information please visit www.thedesigngroup.com.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
TSTBQLLLLZLEBBD
(END) Dow Jones Newswires
April 27, 2022 02:01 ET (06:01 GMT)
Ig Design (LSE:IGR)
Graphique Historique de l'Action
De Juin 2024 à Juil 2024
Ig Design (LSE:IGR)
Graphique Historique de l'Action
De Juil 2023 à Juil 2024