Essentra plc (LON:ESNT), a leading global manufacturer, and provider of essential components and solutions, has provided the following trading update in respect of the current financial year ending 31 December 2024.
At the half year results, published 30 July 2024, the Group indicated that market conditions in its end-markets were mixed by region, with modest sequential improvement in volume trends through the first half. The Group had previously anticipated a further modest improvement in volumes in the second half, underpinned by ongoing recovery of demand across end-markets. However, through August and into September, consistent with the weak PMI metrics widely reported, market conditions in Europe, (including Turkey) have softened. Whilst the Americas region has reported a slower than anticipated rate of recovery, APAC remains broadly in line with expectations.
The impact of the market back drop on trading since the half year 2024 results, combined with a consequently more cautious view of the likely timing of further modest improvements in market conditions has led to the Board revising its expectations for full year 2024. Including the impact of adverse foreign exchange retranslation, estimated to be c.£2m, the Board now expects 2024 full year adjusted1 operating profit to be in the range of £40m-£42m2.
Management remain confident in the business model and that the Company is well positioned, supported by a right-sized cost base and robust operations, to benefit from high levels of operational leverage when normalised growth returns. The Group continues to balance its investment in value creating opportunities across the business alongside cost mitigation activities and driving efficiencies, which has supported strong gross and operating margins. The balance sheet remains robust, and full year leverage guidance remains unchanged.
Essentra will issue its Q3 results for the three months ending 28 September 2024 on 24 October 2024.
