City round-up: Renold; McBride; Ultimate Products

Strong momentum from the second half of the previous financial year has continued into the first half of the current fiscal year, for Manchester-based industrial chains manufacturer, Renold.

The group announced first half figures for the six months to September 30, today, that showed a 22% increase in revenues of £116.3m, but a three per cent fall in pre-tax profits of £6.5m, albeit against a background of rising inflation.

Net debt stood at £34m at the end of the reporting period, up from £13.9m in the same period a year ago, but this is mainly due to a €20m initial cash consideration for the acquisition of Industrias YUK, S.A.

The board has decided not to declare an interim dividend and the dividend policy will remain under review as margin and cash flow performance continues to develop.

The group said the first half performance was helped by markets continuing to recover, despite cost inflation, economic uncertainty and global supply chain disruption.

Group order intake in the period was £121.3m, up 18.9%, excluding a prior year long term military contract, or 11% at constant exchange rates.

The order book at September 30, 2022, of £99m, continues at a record high, compared with £72.1m a year ago.

Renold’s acquisition of Industrias YUK, S.A. for €24m increases its access to the Iberian chain and wider European CVC markets. The integration process is well progressed and the business is performing ahead of expectations.

There is also good progress on capital investment, productivity improvements and cost reduction programmes, accelerating the integration of a group-wide supply chain and increasing capabilities.

Chief executive, Robert Purcell, said: “The strong trading momentum experienced in the second half of the last financial year has continued in the first half, with the group continuing to successfully manage significant inflation and supply chain disruption, resulting in growing sales and record orders.

“Whilst we are mindful that global markets continue to be uncertain, with ongoing labour and energy cost inflation and supply chain challenges, the group’s trading momentum continues to be positive. The group has record order books and the acquisition of YUK provides opportunities for synergies and further growth.”

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McBride products

Household cleaning products group, McBride, said revenues for the first four months of the current fiscal year are 29% higher than the same period last year, but this has been impacted by rising raw materials prices.

The Manchester-based manufacturer and supplier of private label and contract manufactured products for the domestic household and professional cleaning and hygiene markets, issued an update ahead of its annual general meeting later today, in which it said, despite cost pressures and the political and macro-economic environment, it is continuing to trade in line with expectations.

It confirmed the group is making solid progress with its strategic initiatives as identified in ‘project compass’ and has significantly improved customer service levels following the appointment of a new group logistics director.

McBride said it is focused on executing its volume and revenue plans with the combination of new wins and private label share growth overall meaning its factories remain busy, despite the overall market for household products being lower year on year.

While the cost of most raw material groups is steadying, input costs for certain raw materials have continued to climb to all-time highs. Strong control of the group’s cost base has balanced these higher costs in the early part of the year, such that it has traded in line with its expectations.

The funding situation has stabilised after the recent successful refinancing, with month end liquidity at an average of circa £61m in the first four months of the financial year.

Supplies of certain raw material and packaging items remain tight and additionally energy concerns as winter begins are driving input prices further upwards and production of certain key materials downwards. Consequently, the group is continuing to seek mitigations with customers, either through further price increases or product engineering with the size of the required margin recovery widely varying between product families.

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Salter Origins

Oldham consumer goods group, Ultimate Products, the owner of a number of major homeware brands including Salter and Beldray, announced a retail deal with supermarket giant Sainsbury’s today.

Its newly developed Salter Origins range of sustainable kitchenware items has now launched exclusively in Sainsbury’s stores across the UK, with a wider roll out across other retailers expected to follow in 2023.

The Origins range, which has performed strongly in its opening weeks, includes nearly 20 coordinated cookware, dinnerware and utensil items, all of which are made entirely from eco-friendly materials that are recycled and/or recyclable and sustainably packaged. In addition, all wooded items are FSC-certified, guaranteeing responsible forestry, while all cooking items are PFAS-free, ensuring non-toxic and planet-friendly cookware.

Ultimate Products said it has a close and longstanding relationship with Sainsbury’s, which stocks several of the group’s brands in its stores. Salter Origins is the first Salter range where sustainability was a key factor in its being chosen. In addition, the Salter Origins range was also selected for its appealing and coordinated aesthetic, as well as its value offer.

Jenny Stewart, Ultimate Products commercial director, said: “We are incredibly proud to see the beautiful Salter Origins range come to life in Sainsbury’s stores across the country. For over 260 years, Salter has been at the forefront of innovation, and we’re delighted to continue leading the way with sustainable ranges like the Origins collection. It is proving to be hugely popular with Sainsbury’s customers and we expect to continue the roll-out with other retailers in 2023.

“I am confident that this will be the first of many sustainable ranges of ours making their way onto national retailers’ shelves, and we will continue to do everything we can to meet consumer demand, while at the same time helping to save the planet.”