Trading update & Board Change
10 February 2022
("Pittards", "Company" or "the Group")
Trading update & Board Change
Pittards plc (AIM: PTD), the specialist producer of technically advanced leather and luxury leather goods for retailers, manufacturers, and distributors, announces a trading update in respect of its financial results for the year ended 31 December 2021 ("FY2021") which are planned to be announced on 23 March 2022.
Key highlights (unaudited)
· FY 2021 sales revenue up 30% to £19.8m (2020: £15.2m)
· Return to profitability £0.5m (2020: £2.3m loss) for full year in line with market expectations
· Sales order book opened, up 25% in January 2022 compared to the start of 2021
End of year summary
Sales revenue rose 30% to £19.8m (2020: £15.2m), slightly ahead of market estimates, whilst profit before tax is expected to be in line with market estimates.
The well documented disruption in the global shipping and transport market impacted our supply chains. Cases of COVID directly impacted production, capacity during the year, and distribution performance across our business and supply chains. A strategic decision was made to increase raw material inventory to counter supply chain issues. This resulted in more material being in transit than usual from Ethiopia, with sheep skin raw material up over £1.4m in value terms, of which £1.1m (2020: £0.1m) was in transit at year end. Our strategy to utilise existing finished and processed material achieved a reduction of £1.0m in finished goods and work in progress inventory. The combination of these factors resulted in inventory closing only marginally higher at £15.4m (2020: £15.0m).
2021 was also a year of higher-than-normal capital investment with aggregate capital spend over the period of £0.8m, laying the foundations for 2022 and beyond. Net debt at the year-end stood at £10.7m (2020: £10.1m).
After 3 years' service, Richard Briere, Group CFO, is stepping down from the Board to return to a senior role in private equity. He will remain a Director of the Company until his departure in April 2022. Richard will remain focused on the delivery of the Company's full year results, scheduled for 23 March 2022, and on ensuring the effective transition of his responsibilities. The Company is actively recruiting his replacement.
We remain cautious, in the short term, but hope the pandemic is now evolving through a final phase to enable a recovery to more normal conditions. Signs of recovery in sales, identified at the interim stage, continued in the second half. Given the sales order book, we therefore anticipate a further improvement in sales and profit in 2022, notwithstanding global inflationary pressures, particularly surrounding energy, and input costs.
Certain information contained in this announcement would have constituted inside information (as defined by Article 7 of Regulation (EU) No 596/2014) ("MAR") prior to its release as part of this announcement and is disclosed, in accordance with the Company's obligations under Article 17 of MAR.
For further information, please contact:
Stephen Yapp, Chairman
Reg Hankey, CEO
Richard Briere, CFO
+44 (0) 1935 474 321
WH Ireland Limited
Mike Coe, Sarah Mather
+44 (0)20 7220 1666
Paul Vann, Nicholas Johnson
+44 (0)20 7933 8780 or +44 (0)7768 807631