31 August 2001
FOR IMMEDIATE RELEASE 31 AUGUST 2001
Ultraframe plc issued a Group trading update today ahead of the financial year
end on 28 September 2001. The preliminary results for the year ending 28
September 2001 will be announced on 4 December 2001.
Core UK Business
Our statement on 26 June 2001, on the announcement of the acquisition of the
Four Seasons Group, reflected improvements in turnover in the early weeks of
the summer and we then saw our normal seasonal uplift. Sales in June and July
were over 8% ahead of the equivalent months in 2000. However, this
like-for-like improvement has not been as significant in August. Whilst we
expect sales in August and September to be ahead of those for the comparable
period in 2000, we do not now expect to benefit from the volume growth
required to achieve the forecasts currently in the market for our core
Gross margins within the core business in the 10 months to July 2001 have
maintained at the levels achieved in the year ended September 2000 against a
higher cost base for the period. Ultraframe has high operational gearing with
the majority of sales and profits normally generated in the second half of the
financial year. Hence, a shortfall in expected sales in the normally stronger
summer months has a significant impact on the full year results.
The Four Seasons Group, acquired on 16 July 2001, is being successfully
integrated into the Ultraframe Group.
Since the acquisition, Four Seasons has traded in line with expectations
giving us confidence that the impact on results for the post acquisition
period to 28 September 2001, after taking account of interest, goodwill
amortisation and integration costs, will be neutral. Four Seasons represents a
major part of our future strategy, giving us critical mass in the important US
market, and we remain positive about the prospects for this business and
continue to believe the acquisition will be earnings enhancing post goodwill.
Outlook for the year ending 28 September 2001
Results for the current financial year are still principally driven by our
core UK domestic conservatory roofing business. As expected there has been a
significant increase in profits in the second half of the year with
contribution, at the operating level before goodwill amortisation, expected to
be nearly double the level achieved in the first half. However, in light of
current trading conditions and having taken a conservative view for the Group
as a whole, we expect the full year profit to be not less than £25.3 million,
before goodwill amortisation of £0.8 million.
Longer term outlook
Ultraframe has a market leading position in the UK, Europe, and North America.
Ultraframe's own market research and that of independent observers continues
to demonstrate strong appeal for the Group's products in all its markets.
Recent investments and the Four Seasons acquisition are part of a longer term
strategy which enhance the Group's sectoral and geographic spread. The Board
remains committed to this strategy, which it believes will provide scope for
good growth, as the Group continues to develop in the markets and regions in
which it operates.
David Moore (Chief Executive) 01200 443311
James Henry (Finance Director)
Binns & Co Public Relations Ltd 020 7786 9600
Brian Coleman-Smith / Jacqui Graves