A STRONG FIRST HALF PERFORMANCE WITH CONTINUED
MARKET SHARE GAINS
LONDON, Nov. 7, 2022
/PRNewswire/ --
DAVID EGAN, ACTING CHIEF
EXECUTIVE OFFICER, COMMENTED: "We have delivered a strong
revenue and profit performance in the first half as our
differentiated proposition continues to resonate with all our
stakeholders. Our performance has been driven by our people who are
aligned to our purpose-led culture and are working hard to improve
our customer experience and commercial focus further. We continue
to invest in our Group to become stronger, more profitable and to
take greater market share. While mindful of a slowing economic
backdrop, we remain optimistic that we will continue to outperform
the market."
Highlights
|
H1
2022/23
|
H1
2021/22
|
Change
|
Like-for-
like2 change
|
Revenue
|
£1,458.0m
|
£1,208.9m
|
21 %
|
16 %
|
Adjusted3
operating profit
|
£196.1m
|
£144.8m
|
35 %
|
30 %
|
Adjusted3
operating profit margin
|
13.4 %
|
12.0 %
|
1.4 pts
|
1.5 pts
|
Adjusted3
profit before tax
|
£191.6m
|
£141.8m
|
35 %
|
30 %
|
Adjusted3
earnings per share
|
31.5p
|
23.0p
|
37 %
|
32 %
|
Operating
profit
|
£187.0m
|
£139.1m
|
34 %
|
29 %
|
Profit before
tax
|
£182.5m
|
£136.1m
|
34 %
|
29 %
|
Earnings per
share
|
30.0p
|
21.5p
|
40 %
|
34 %
|
Interim
dividend
|
7.2p
|
6.4p
|
13 %
|
|
Adjusted3
free cash flow
|
£111.9m
|
£84.8m
|
32 %
|
|
Net cash /
(debt)
|
£2.6m
|
£(83.6)m
|
|
|
Net debt to
adjusted3 EBITDA
|
n/m
|
0.3x
|
|
|
Outperformance reflects the strength of our people,
purpose-led culture and differentiated offer
- Our people are the most powerful driver of our success,
delivering our strong revenue and profit performance
- Employee engagement score of 78 (2021/22: 75), placing us near
the upper quartile of top performing companies
- Ongoing increase in average order value as our proposition
gains traction with our core customers
- Industrial products, 74% of Group revenue, grew volumes c. 8%
with total like-for-like growth of 21%
- Net Promoter Score of 48.5 (rolling six month4),
with all regions increasing slightly, remains a Group-wide
focus
- Awarded Platinum medal with EcoVadis: we are committed to being
net zero in our operations by 2030
- All employees are empowered and aligned to our Journey to
Greatness through a share-based award5
Margin accretion driven by a tighter commercial focus and
operating leverage while investing strategically
- Revenue growth of 21% includes a 16% like-for-like contribution
and a 5% currency benefit2
- Gross margin of 45.5%, up 1.8 pts year on year, due to improved
pricing and tighter discount policy
- One-off payment of c. £5 million to financially support our
employees during these more difficult economic times
- Adjusted3 operating profit margin of 13.4% benefits
from gross margin gains and strong operating cost leverage
-
- EMEA operating profit margin of 15.4% includes ongoing targeted
investment in our operating model
- Americas operating profit margin of 17.0% reflects strong
operational leverage on the underlying base
- Asia Pacific operating profit
margin of 16.4% due to growing scale and a tighter commercial
focus
- Adjusted operating profit conversion of 29.6%
Rigorous financial management and balance sheet strength
supports organic and inorganic growth opportunities
- Adjusted free cash flow generation was strong at £111.9 million
with inventory investment supporting growth
- Modest net cash position, with proforma net debt to adjusted
EBITDA of c. 0.6x upon acquisition of Risoul6
- Return on capital employed of 31.4%, a 6.7 percentage point
increase year on year due to strong profitability
- Increased sustainability-linked loan to £400 million and
maturity extended to five years at similar terms
- Acquisitions of domnick hunter, Thailand, and Risoul6, Mexico, enhance our product, service and
market offer
- Strong pipeline of acquisition opportunities and strict
financial, strategic and cultural discipline being maintained
Current trading and outlook
Overall, trading over the
first four weeks of the second half has been in line with our
expectations. Despite the more difficult economic backdrop, our
performance in EMEA remains broadly in line with the second quarter
driven by our strong industrial offer, greater proportion of
service solutions revenue and improving service levels. Americas
continues to deliver strong revenue, against toughening
comparatives, as we maintain our investment in our operational
capabilities after a period of exceptional growth. Trading in
Asia Pacific continues to be
affected by the slower electronics market and reduced availability
of single-board computing product as well as a more challenging
geopolitical backdrop and lockdowns resuming in China.
Notwithstanding the tougher global economic environment, trading
remains in line with our and consensus expectations for the full
year.
- Consensus for the year ending 31 March
2023 is revenue of £2,919 million, adjusted operating profit
of £372.4 million and adjusted profit before tax of £364.9 million.
Source: rsgroup.com/investors/analyst-coverage.
- Like-for-like change excludes the impact of acquisitions and
the effects of changes in exchange rates on translation of overseas
operating results, with 2021/22 converted at 2022/23 average
exchange rates for the period. Revenue is also adjusted to
eliminate the impact of trading days year on year. Acquisitions are
only included once they have been owned for a year, at which point
they start to be included in both the current and comparative
periods for the same number of months. Currency movements increased
revenue by £48.7 million and fewer trading days decreased revenue
by £8.0 million during the period. Currency movements increased
adjusted profit before tax by £5.8 million.
- Adjusted excludes amortisation and impairment of intangible
assets arising on acquisition of businesses, acquisition-related
items, substantial reorganisation costs, substantial asset
write-downs, one-off pension credits or costs, significant tax rate
changes and associated income tax. See Note 11 for definitions and
reconciliations of all alternative performance measures.
- Our customer key performance indicator is Group rolling
12-month Net Promoter Score (NPS). We have updated the methodology
from 1 April 2022 to make it more
representative of our customer base. The changes made are to weight
NPS by percentage of orders; separate out business to business
(B2B) from business to consumer (B2C) customers, with B2B becoming
our primary metric; and customers that opted out of marketing can
be included in the survey. As a result, we currently do not have
the data to calculate a Group rolling 12-month NPS (see appendix in
2021/2022 full year results presentation for full details).
- Awarded to all permanent and fixed-term employees and
apprentices employed on 14 July
2022.
- Acquisition of Risoul is subject to review by Mexican
competition authorities and we anticipate it will be completed by
the end of December 2022.
Enquiries:
|
|
|
David Egan
|
Acting Chief Executive
Officer
|
020 7239
8400
|
Lucy Sharma
|
VP Investor
Relations
|
020 7239
8427
|
Martin Robinson /
Olivia Peters
|
Tulchan
Communications
|
020 7353
4200
|
Notes to editors:
RS Group plc is a leading global omni-channel industrial product
and service solutions provider to customers who are involved in
designing, building and maintaining industrial equipment and
operations, safely and sustainably. We stock more than 700,000
industrial and electronic products, sourced from over 2,500 leading
suppliers, and provide a wide range of product and service
solutions to over 1.2 million customers. With operations in 32
countries, we trade through multiple channels and ship
over 60,000 parcels a day.
We support customers across the product lifecycle, whether via
innovation and technical support at the design phase, improving
time to market and productivity at the build phase, or reducing
purchasing costs and optimising inventory in the maintenance phase.
We offer our customers tailored product and service propositions
that are essential for the successful operation of their businesses
and help them save time and money.
RS Group plc is listed on the London Stock Exchange with stock
ticker RS1 and in the year ended 31 March
2022 reported revenue of £2,554 million.
Click here to view the full announcement.
View original content to download
multimedia:https://www.prnewswire.com/news-releases/rs-group-plc-results-for-the-half-year-ended-30-september-2022-301669632.html
SOURCE RS Group plc