Highlights:
• Strong core business* growth in H1
– Total sales volumes up 5%
– Core volumes* up 19%, offsetting lower year on year Consumer Electronics
– Group revenue up 12%, constant currency revenue** up 4%
– Record core volumes* in Q2 of >1000 tonnes, driven by Automotive, Electronics (ex-Consumer), Value Added Resellers
– Medical remains muted, reflecting mature US Spine market
• Further pipeline progress
– New Gears mega-programme secures initial OEM production opportunity for 2018
– PEEK-OPTIMATM HA-Enhanced on track for FY17 meaningful revenue
• Investment to accelerate Polymer & Parts strategy
– £10m acquisition of Zyex PEEK fibres business to expand semi-finished products offering
– TxV Aero Composites joint-venture to support differentiated Aerospace products
– Polymer Innovation Centre on track for completion in H2; support prototyping & new grades
• Strong cash generation continues
– Cash up 90% to £86m and operating cash conversion# 137%
– Interim dividend up 4% to 12.20p (H1 16: 11.73p)
David Hummel, Chief Executive of Victrex, said: “Victrex delivered a positive performance across most of our markets in the first half, with the strength of our core business offsetting much lower year on year volumes in Consumer Electronics. Automotive, Electronics (ex-Consumer) and Value Added Resellers performed particularly well whilst as anticipated, Medical remains muted, reflecting the maturity of the US Spine market.
“We made continued progress in our new products pipeline, including an initial production opportunity for Gears. Our investments to support our Polymer & Parts strategy include a joint venture for new and differentiated Aerospace products and our Zyex PEEK fibres acquisition, which will enhance our semi-finished and differentiated products offering. Our aspirations are for new differentiated products to be 10-20% of sales in the medium term.
“Whilst we delivered a strong first half performance and the Group continues to be highly cash generative, we note that there is potential for variability in the scale of Consumer Electronics volumes during the second half, with visibility remaining low. Consequently, although our positive growth momentum has continued into the second half and helps to underpin 2017, our overall expectations are unchanged. We are focused on driving growth, on cost efficiency and making progress in delivering our Polymer & Parts strategy.”