MPAC Mpac Group Plc

TIDMMPAC

RNS Number : 5603F

Mpac Group PLC

11 July 2023

11 July 2023

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018

Mpac Group plc

("Mpac" or the "Group")

Trading update and notice of results

Mpac Group plc, a global leader in high-speed packaging and automation solutions, issues a trading update ahead of the release of its unaudited results for the six months ended 30 June 2023.

Trading in the first half was in line with the Board's expectations. As communicated in the AGM statement in May and as further detailed below, we expect the full year financial performance to be weighted towards the second half of the year. The strength of the order book and nature of projects for delivery supports the Board's full year expectations, which remain unchanged.

The performance of our recurring, higher margin Service business has been strong, benefiting from enhanced engagement and an improved service model for our customers. On-site commissioning of the CQP assembly line for FREYR Battery has commenced and is ongoing. As anticipated, Original Equipment margins in the period were impacted by the completion of projects which had been affected by supply chain disruption in 2022. The effects of this are now largely cleared and accordingly, second half trading is anticipated at normalised margins, which gives confidence to the second half weighting.

Year to date order intake of GBP62.4m is significantly ahead of the prior year (H1 2022: GBP32.8m) and the June 2023 closing order book of GBP78.4m is above the 2023 opening order book of GBP67.2m.

Mpac has a strong balance sheet, with the expansion of working capital in 2022 unwinding in line with expectations and the Group closed the half year with positive net cash.

Beyond the short-term economic challenges, the outlook for the business remains positive. We carry forward a strong prospect pipeline and order book, concentrated on companies in our core, resilient, end markets of Healthcare and Food and Beverage and with a balance sheet which provides us with the ability to invest in the Group for growth over the medium term and beyond. The Group remains focused on executing its long-term strategy of delivering OE and Service growth at improved margins.

Adam Holland, Chief Executive, commented:

"I am delighted to provide my first update as Chief Executive. I am pleased to be able to report significant momentum in the first half of 2023 with increase in Original Equipment and Service order intake and a closing H1 order book of GBP78.4m, up significantly on the prior year. In addition, the prior year expansion of working capital has unwound in line with expectations, and we close H1 in a positive net cash position. We have a lot to do in the second half but are anticipating normalised margins in the period and are focused on delivering the strong order book for our customers. We have made good progress in strengthening the leadership team and I am confident that Mpac has the employee skillset to take advantage of the attractive markets in which we operate and deliver on our strategic objectives."

The Group expects to announce its unaudited results for the six months ended 30 June 2023 on 7 September 2023.

For further information, please contact:

 
 Mpac Group plc                          Tel: +44(0)24 7642 1100 
  Adam Holland, Chief Executive 
  Will Wilkins, Group Finance Director 
 Shore Capital (Nominated Adviser &      Tel: +44(0)20 7408 4050 
  Broker) 
  Advisory 
  Patrick Castle 
  Iain Sexton 
  Broking 
  Henry Willcocks 
 Hudson Sandler                          Tel: +44(0)20 7796 4133 
  Nick Lyon 
  Nick Moore 
 

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