Update on Full Year Expectations and OEM Approvals
The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
6 June 2018
Autins Group plc
(the "Company" or the "Group")
Update on Full Year Expectations and
Technical Approvals with Strategic OEM Partners
Autins Group plc (AIM: AUTG), a leading designer, manufacturer and supplier of acoustic and thermal insulation solutions for the automotive sector is providing an update on anticipated activity levels for the second half of the current financial year, together with confirmation that the Group has now secured technical approval for its Neptune materials with key strategic European OEMs.
The Board previously provided guidance that a significant weighting to the second half of FY2018 was expected, following strong top line growth in FY2017. Whilst we continue to grow in FY2018, the Board now expects that the second half performance is likely to remain broadly similar to the first, as the latest visibility to current volumes indicates lower levels of supply required from some of our major customers in the UK.
With regard to the Group's Neptune product, the stated strategy has been to gain technical approval from Europe's leading automotive OEMs in order to create a strong platform for widespread adoption of the technology, whilst simultaneously reducing exposure to any single manufacturer or geography. The Board is pleased to report that approval has been gained from all the major targeted strategic OEMs across Germany, UK, and Sweden, giving significant scope for adoption among the numerous respective constituent brands and tiers, enabling Autins to bid for work on new and existing model platforms.
We have already seen some success in being awarded initial specific parts for future year models in each of these countries, however, given the long lead times within the automotive sector, the Board does not anticipate substantial immediate uplift in order volumes. The opportunity to quote for new and current platforms in the coming months will, if successful, significantly broaden the existing customer base.
Further investment has been made in the UK operations to ensure our capacity and capability aligns with our strategic growth prospects, however changes in customer schedules affecting product mix and production efficiencies, as well as significant competitive pressures with regards to existing work and new platform launches, have resulted in short-term margin erosion.
As a result of the combination of factors referred to above, the Board expects the Group to report solid year on year top-line growth but FY2018 revenues will be behind market expectations and profitability will be significantly below market expectations.
Adam Attwood, Non-Executive Chairman, commented:
"The investments made in the past year have enabled us to make good progress to ensure we can deliver sustainable growth. We have built a strong pipeline of quoted opportunities whilst winning good business for future year models across major targeted OEMs. This diversification across UK and Europe underpins our strategy and positions us for a bright future. However, before this new business can come into live production, we have near-term challenges with lower demand in the UK constraining our current financial performance."
The Board is currently finalising the evaluation of the impact on the year to 30 September 2018 and will provide guidance at the time of the publication of the interim results for the six months ended 31 March 2018 on Wednesday 13 June 2018.
For further information please contact:
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Autins Group plc Adam Attwood, Non-Executive Chairman Michael Jennings, Chief Executive James Larner, CFO
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Via Newgate |
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Cantor Fitzgerald Europe (Nominated Adviser and Broker) Philip Davies Will Goode
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Tel: 020 7894 7000 |
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Newgate Communications (Financial PR) Adam Lloyd James Browne
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Tel: 020 7653 9850
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About Autins
Autins specialises in the design, manufacture and supply of acoustic and thermal insulation solutions primarily in the automotive sector but with an increasing focus on other sectors, including flooring, building and wider industrial applications.
The Group is one of the leading suppliers of noise and heat management products in the automotive market, producing and supplying over two million parts per month to customers including some of the world's leading vehicle manufacturers.
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