Senior plc (LON:SNR) has announced its results for the year ended 31 December 2023.
| FINANCIAL HIGHLIGHTS | Year ended 31 December | change | change (constant currency) (4) | |||
| 2023 | 2022 | |||||
| REVENUE | £963.5m | £848.4m | +14% | +14% | ||
| OPERATING PROFIT | £37.9m | £32.5m | +17% | +17% | ||
| ADJUSTED FOR: | ||||||
| AMORTISATION OF INTANGIBLE ASSETS FROM ACQUISITIONS | £2.2m | £0.2m | ||||
| NET RESTRUCTURING COST/(INCOME) | £5.6m | £(4.2)m | ||||
| SITE RELOCATION COST | £0.1m | £nil | ||||
| ADJUSTED OPERATING PROFIT (1) | £45.8m | £28.5m | +61% | +61% | ||
| ADJUSTED OPERATING MARGIN (1) | 4.8% | 3.4% | +140 bps | +140 bps | ||
| PROFIT BEFORE TAX | £22.8m | £22.4m | +2% | +2% | ||
| ADJUSTED PROFIT BEFORE TAX (1) | £38.3m | £20.1m | +91% | +92% | ||
| BASIC EARNINGS PER SHARE | 7.52p | 4.86p | +55% | |||
| ADJUSTED EARNINGS PER SHARE (1) | 10.28p | 4.36p | +136% | |||
| TOTAL DIVIDEND (PAID AND PROPOSED) PER SHARE | 2.30p | 1.30p | +77% | |||
| FREE CASH FLOW (2) | £15.5m | £27.7m | -44% | |||
| NET DEBT EXCLUDING CAPITALISED LEASES (2) | £132.0m | £100.5m | £32m increase | Net debt / EBITDA(5)1.6x | ||
| NET DEBT (2) | £203.8m | £178.9m | £25m increase | |||
| ROCE (3) | 7.1% | 4.7% | +240bps | |||
Highlights
| ● | Strong trading performance across the Group compared to 2022 |
| ● | Adjusted EPS of 10.28p includes benefit of 2.54p from release of provisions for uncertain tax positions |
| ● | Continued ROCE improvement, increasing by 240 bps |
| ● | Robust core market demand, with a healthy book-to-bill of 1.14 |
| ● | Healthy balance sheet with net debt / EBITDA(5) of 1.6x |
| ● | Spencer Aerospace revenues increased by over 50% year-on-year |
| ● | The Board anticipates good growth for the Group in 2024 in line with its expectations |
| ● | Final dividend of 1.70p, bringing full year dividend to 2.30p, up 77%, reflecting improved performance and future prospects |
Commenting on the results, David Squires, Group Chief Executive Officer of Senior plc, said:
“Senior has delivered a year of strong trading performance and profit growth with significant momentum across our two divisions.
Our Flexonics Division performed well in 2023 with double-digit margins and strong growth in both land vehicle and power & energy. In 2024 we expect to maintain good performance with land vehicle market demand normalising to more typical levels and continuing robust demand in our downstream oil & gas business.
Momentum is building in our Aerospace Division. We have achieved a diversified position across key civil and defence aircraft platforms and are benefiting from increasing aircraft build rates which we expect will lead to higher sales in 2024 and beyond. Supply chain issues are improving as anticipated and we expect further improvement as 2024 progresses. Beyond this, we can expect Aerospace performance to continue to improve in 2025 as production rates increase, supply chain continues to improve, and additional contractually agreed price rises take effect.
Overall, the Board anticipates good growth for the Group in 2024 in line with its expectations.
Looking further ahead, we remain on track to achieve our stated ROCE target of at least 13.5%. Our strategy and positioning in attractive and structurally resilient core markets, active portfolio management, combined with our sector leading sustainability credentials and highly relevant technical capabilities, provides confidence of continuing performance improvements across our Aerospace and Flexonics Divisions, enhancing value for our stakeholders.”
Notes
This Release represents the Company’s dissemination announcement in accordance with the requirements of Rule 6.3.5 of the Disclosure and Transparency Rules of the United Kingdom’s Financial Services Authority. The full Annual Report & Accounts 2023, together with other information on Senior plc, can be found at: www.seniorplc.com
The information contained in this Release is an extract from the Annual Report & Accounts 2023, however, some references to Notes and page numbers have been amended to reflect Notes and page numbers appropriate to this Release.
The Directors’ Responsibility Statement has been prepared in connection with the full Financial Statements and Directors’ Report as included in the Annual Report & Accounts 2023. Therefore, certain Notes and parts of the Directors’ Report reported on are not included within this Release.
| (1) | Adjusted operating profit and adjusted profit before tax are stated before £2.2m amortisation of intangible assets from acquisitions (2022 – £0.2m), £5.6m net restructuring costs (2022 – £4.2m net income) and £0.1m site relocation cost (2022 – £nil). Adjusted profit before tax is also stated before costs associated with corporate undertakings of £7.6m (2022 – £1.7m). A reconciliation of adjusted operating profit to operating profit is shown in Note 4. Adjusted earnings per share includes the benefit of a release of £10.5m of provision for uncertain tax positions in the second half of 2023, of which £3.5m relates to interest (see Note 5 for further details). Adjusted operating margin is the ratio of adjusted operating profit to revenue. |
| (2) | See Note 12b and 12c for derivation of free cash flow and of net debt, respectively. |
| (3) | Return on capital employed (“ROCE”) is derived from annual adjusted operating profit (as defined in Note 4) divided by the average of the capital employed at the start and end of that twelve-month period, capital employed being total equity plus net debt (as derived in Note 12c). |
| (4) | 2022 results translated using 2023 average exchange rates – constant currency. |
| (5) | The following measures are used for the purpose of assessing covenant compliance for the Group’s borrowing facilities: ●EBITDA is adjusted profit before tax and before interest, depreciation, amortisation and profit or loss on sale of property, plant and equipment. It also excludes EBITDA from businesses which have been disposed and includes 12 months EBITDA for businesses acquired and it is based on frozen GAAP (pre-IFRS 16). EBITDA for 2023 was £84.1m. ●Net debt is defined in Note 12c. It is based on frozen GAAP (pre-IFRS 16) and as required by the covenant definition, it is restated using 12-month average exchange rates. ●Interest is adjusted finance costs and finance income before net finance income of retirement benefits. It also excludes interest from businesses which have been disposed and it is based on frozen GAAP (pre-IFRS 16). ●The definition of adjusted items in the Consolidated Income Statement is included in Note 4. |
The Group’s principal exchange rate for the US Dollar applied in the translation of Income Statement and cash flow items at average 2023 rates was $1.24 (2022 – $1.24) and applied in the translation of balance sheet items at 31 December 2023 was $1.27 (31 December 2022 – $1.21).
Annual Report
The full Annual Report & Accounts 2023 is now available online at www.seniorplc.com. Printed copies will be distributed on or soon after 15 March 2024.
Webcast
There will be a presentation on Monday 4 March 2024 at 11.00am GMT accessible via a live webcast on Senior’s website at www.seniorplc.com/investors. The webcast will be made available on the website for subsequent viewing.
