Scapa Group on course for 10% uplift in annual trading profits
Manchester-based wound-care specialist, Scapa Group, said it is on course to exceed its full year trading profit forecasts by around 10%.
In an update ahead of its annual general meeting this morning, the group issued a trading update for its first quarter.
It said it has delivered first quarter revenues in the three months to June 30 well ahead of its COVID-19 scenario plan.
Trading in both its health and industrial divisions has also continued to improve into the second quarter of the current financial year, to date.
Scapa said it acted swiftly to implement structural costs changes across the business in response to the impact of the COVID-19 pandemic on the reduction in product demand, as well as ensuring variable costs were closely managed to match the new demand levels.
It said working capital management remains strong, with adjusted net debt at the end of the first quarter of £18.4m, including net proceeds of £31.6m from the equity placement in May 2020, compared with £54.4m at the end of the 2020 fiscal year.
The combination of the better than anticipated business performance in the current fiscal year to date, early cost intervention measures and continued improvement across both divisions mean the group’s outlook on full year trading profit is trending approximately 10% ahead of market expectations.
In June this year Scapa revealed its annual 2019/20 revenues had increased 2.8% to £320.6m, but that the group had made a loss before tax of £51m, compared with a pre-tax profit of £14.9m the previous year.
This was due to the loss of its ConvaTec contract, ongoing operational footprint improvements, and goodwill and intangible asset impairments. The group said impairments totalled £54.6m.
Scapa Healthcare works with some of the world’s leading companies in advanced wound care, consumer wellness and skin-friendly medical device fixation.
Its industrial arm is a global supplier of bonding solutions and a manufacturer of adhesive-based products which offer value in industrial applications due to their lightweight, easy-to-apply properties, including adhesive tapes, films and foams.