11 February 2022
Victrex plc – AGM & Q1 Interim Management Statement
'Solid start to FY 2022; continuing momentum & healthy demand; FY expectations unchanged'
Victrex plc is an innovative world leader in high performance polymer solutions, delivering sustainable products which support CO2 reduction and bring environmental and societal benefit in multiple end-markets. Today's Interim Management Statement (IMS) covers the first quarter of our FY 2022 financial year from 1 October 2021 to 31 December 2021.
Overall, the Group saw a solid start to FY 2022 and for Q1 as a whole:
- Group revenue of £74.6m was 9% ahead of the prior year (Q1 2021: £68.7m)
- Q1 Group sales volume of 1,025 tonnes was 16% ahead of the prior year (Q1 2021: 883 tonnes)
- On a year-to-date (YTD) basis to 31 January 2022, Group volume and revenue is ahead of the prior year, with volume up double-digit.
End market performance
Across our end-markets, Electronics, Energy & Industrial, Medical and VAR saw good year year-on-year growth. Reflecting the current challenges in the Automotive industry, performance was modestly down year-on-year although it has improved from the final quarter of our FY 2021 financial year.
The strong performance in Medical included record quarterly revenues in Asia-Pacific. Medical revenues in the US were slightly lower as the impact of the Omicron variant impacted surgery rates in late 2021.
Mega-programmes
The Group retains an attractive portfolio of short, medium and long-term growth opportunities. In our Knee mega-programme, the clinical trial now has a total of 10 patients with implants, none requiring remedial intervention, with 8 patients having passed the 6-month clinical milestone stage. This success has led to the progression of options for additional partnerships and clinical studies.
In Trauma, with the In2Bones partnership established and commercial launches expected in the second half, subject to US FDA approval, we are preparing for the next phase of manufacturing scale-up, including partner opportunities in Asia.
Financial position & capital allocation
Victrex retains a highly cash generative business model, with available cash of £113.6m at 31 December 2021 (excluding cash ringfenced for our PVYX facility in China). Available cash is prior to payment of the 2021 final dividend and special dividend on 18th February 2022. FY 2022 is expected to be a year of high capital expenditure totalling approximately £60m, focused on China capacity, UK asset improvement and mega-programmes.
Outlook
Jakob Sigurdsson, Chief Executive of Victrex, said: “This is a solid start to FY 2022, with continuing momentum and healthy top-line demand.
“Expectations for the full year are unchanged at this early stage. Whilst we anticipate further volume improvement across several end markets, we are mindful of headwinds including currency, raw material costs and increasing energy inflation. O verall, we continue on plan to deliver year-on-year growth in FY 2022.
” Our second and third quarters will see stronger comparators and as previously communicated, we do not expect to enjoy the restocking benefit seen in Value Added Resellers during the prior year. Our price recovery programme is progressing well, although additional recent increases in energy and raw material costs mean that progress on margin improvement may be held back, particularly in the second half.
“With sustainable products and a strong pipeline of growth opportunities, our Polymer & Parts strategy keeps us well positioned for the medium to long-term.”
Analyst & investor conference call
A conference call with management will take place this morning, Friday 11th February 2022, at 08.30am GMT via +44 (0) 3333 000804 and PIN 98055646# A replay of the call is also available at +44 (0) 333 300 0819 and PIN 425018338#
Annual General Meeting
Victrex's Annual General Meeting will also be held today, starting at 11.00am GMT and taking place at JP Morgan, 1 John Carpenter Street, London EC4Y 0JP. Shareholders are asked to note JP Morgan protocols for attendance including:
- taking a COVID-19 Lateral Flow Device test within 24 hours prior to attending the AGM and only attend if this is negative
- wear a face mask or visor tominimise risk of COVID-19 transmission
- maintain social distancing guidance, or at least 1m distancebetween yourself and others
- use the sanitiser provided
- Avoid shaking hands