Vela Technologies PLC Update on investment in Revolve Performance Ltd (5531C)
16 Oktober 2015 - 2:55PM
UK Regulatory
TIDMVELA
RNS Number : 5531C
Vela Technologies PLC
16 October 2015
Vela Technologies plc
("Vela" or the "Company")
Update on investment in Revolve Performance Limited
The Board of Vela Technologies plc (AIM: VELA), the investing
company focused on early-stage and pre-IPO disruptive technology
investments, announces that Revolve Performance Limited
("Revolve"), one of Vela's portfolio companies, has provided the
board of Vela with an update on Revolve's recent trading
performance. In June 2015 Vela invested GBP50,000 in Revolve and
holds a minority interest in the share capital of Revolve.
In the eight months to 30(th) August 2015, Revolve's trading was
broadly in line with budget, with lower sales offset by higher
gross margins and lower overheads. EBITDA was also above budget.
The Mountune Performance US business showed strong growth in line
with the forecast, whilst the Mountune Performance UK and Revolve
product development divisions fell short of the budgeted revenues.
The Board of Vela has been informed by Revolve that, for the full
year to 31(st) December 2015, management expect EBITDA to be in
line with the Revolve's forecasts, with the early outperformance
offset by lower final quarter sales in the Revolve divisions.
Mountune Performance US sales have grown in line with their
forecasts, with July's sales at a record level of GBP100,000. There
has been a significant uplift in orders from Ford dealerships,
helped by a marketing initiative from Ford Performance. Ford
distributors in Asia and Australia have also recently ordered
Mountune products for the first time. Discussions continue with
Mazda and Honda in the US with regards to potential significant
motor sport and road car projects.
Mountune Performance UK is performing in line with the prior
year. The expected growth did not occur due to a delay in the
approval of a Mountune Focus ST upgrade by Ford, stock shortages
for some products sourced from the Far East, and the delay of a
limited edition Ford Focus programme to 2016. Management expect
growth to resume in 2016, with the introduction of new product
ranges for Ford RS and Mustang cars.
Gross margin was above Revolve's forecast due to a positive
sales mix in the Revolve product development division as well as
higher margin programmes in the Mountune Racing division. Overheads
are lower than forecast due to lower employment costs in the US,
which will increase to forecast levels as staff are recruited
before the year end.
Mountune US will shortly be moving to larger premises, enabling
it to cope with the planned increase in stock and a broader product
range, which will also shortly include the new Ford Mustang and
Ford RS ranges just as in the UK. Consideration is being given to
opening a satellite office in Detroit in order to have resources
near to the Ford headquarters.
Antony Laiker, Executive Director of Vela, made the following
statement in respect of this update:
"Revolve was already a well-established business with
experienced industry management prior to our investment. The
excitement for Vela lies in the potential growth of the Mountune
business over the coming years, particularly in the US. We wish the
team all the best as they manage this exciting growth
business."
The Board of Vela will announce further updates on the
investment in Revolve at the appropriate time.
For further information please contact:
Vela Technologies plc
Brent Fitzpatrick, Non-Executive
Chairman Tel: +44 (0) 7802 262 443
Antony Laiker, Director
Allenby Capital Limited
(Nominated Adviser)
Nick Athanas/Katrina Perez/James Tel: +44 (0) 20 3328 5656
Reeve
Vicarage Capital Limited
(Broker) Tel: +44 (0) 20 3651 2910
Rupert Williams/Jeremy Woodgate
This information is provided by RNS
The company news service from the London Stock Exchange
END
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