Trading Update

RNS Number : 8181S

Focusrite PLC

14 March 2023

 

Strictly embargoed until 07.00, 14th March 2023

Focusrite plc

( " Focusrite" or " the Group")

H1 2023 Trading Update: Profits in line with expectations

Focusrite plc (AIM: TUNE), the global music and audio products group supplying hardware and software used by professional and amateur musicians and the entertainment industry, is pleased to give the following update on trading for the six months ended 28 February 2023 ("H1 2023").

H1 2023 profits for the Group are in line with Board expectations and remain unchanged for the full year supported by stronger gross margins.

Overall demand for the Group's products across its Content Creation and Audio Reproduction businesses has remained resilient, with revenues for H1 2023 expected to be not less than £85 million (H1 2022: £93 million) .  The Board continues to anticipate a weighting towards the second half of the year due to the timing of major new product launches.  As previously reported, the Group has noted some industry-wide demand weakness in Asian markets during the period and, as anticipated, Focusrite branded products were impacted by the earlier phasing of inventory sell-in to the channel prior to the key holiday season.  The Audio Reproduction businesses have shown strong growth reflecting increased demand for live sound, supported by a strengthened supply chain following the acquisition of Linea Research in May 2022.

The Group continues to see an improvement in gross margins as freight costs reduce to more normalised levels; component shortages and supply chain issues are easing; and pricing actions are taking effect.

Net debt as at 28 February 2023 was £14 million (31 August 2022: net debt £0.4million).  This change reflects increased inventory to support the new product launches in the second half, the payment of the final earnout relating to the acquisition of Sequential (£1.2 million), and the £7 million consideration paid for Sonnox in December 2022.  The Board expects the Group's net debt position to improve going forward as the underlying cash generation of the business comes through in the second half.  The Group has bank facilities in place totalling £40 million.

The Board will give a more detailed update at the time of the announcement of the H1 2023 results, which is expected to be in late April 2023.

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Enquiries:
Focusrite plc	[phone]
Tim Carroll (CEO) / Sally McKone (CFO)
Investec Bank plc (Nominated Adviser and Joint Broker)	[phone]
David Flin / William Brinkley / Charlotte Young
Peel Hunt LLP (Joint Broker)	[phone]
Paul Gillam / Michael Burke / James Smith
Belvedere Communications (Financial PR)	[phone]
John West / Llew Angus

Notes to Editors

Focusrite plc is a global audio products group that develops and markets proprietary hardware and software products. Used by audio professionals and musicians, its solutions facilitate the high-quality production of recorded and live sound. The Group trades under eleven established brands: Focusrite, Focusrite Pro, Novation, Ampify, ADAM Audio, Martin Audio, Optimal Audio, Linea Research, Sequential, Oberheim and Sonnox.

With a high-quality reputation and a rich heritage spanning decades, its brands are category leaders in the music-making and audio recording industries. Focusrite and Focusrite Pro design and manufacture audio interfaces and other products for recording musicians, producers and professional audio facilities. Novation and Ampify products are used in the creation of electronic music, from synthesisers and grooveboxes to industry-shaping controllers and inspirational music-making apps. ADAM Audio studio monitors have earned a worldwide reputation based on technological innovation in the field of studio loudspeaker technology.  Martin Audio designs and manufactures performance-ready systems across the spectrum of sound reinforcement applications. Linea Research designs, develops, manufactures and sells market innovative professional audio equipment globally. Sequential designs and manufactures high end analogue synthesizers under the Sequential and Oberheim brands.  Sonnox is a leading designer of innovative, high quality, award-winning audio processing software plug-ins for professional audio engineers.

The Group has offices in four continents and a global customer base with a distribution network covering approximately 240 territories.

Focusrite plc is traded on the AIM market of the London Stock Exchange.

 

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