The 600 Group PLC ("the Group"), the diversified industrial engineering company (AIM: SIXH), today announces its results for year ended 28 March 2020.
· Revenue from continuing operations increased by 3.1% to $67.2m (2019: $65.2m)
· Group profit before tax and adjusting items of $1.1m (2019: $4.1m)
· Loss before tax after adjusting items of $0.63m (2019: profit $4.3m)
· Given the current uncertainty, no dividend recommended for remainder of the year
Strategic & operational highlights
· Results impacted by difficult trading environment
o Challenging market conditions compounded by the significant disruption caused by the Coronavirus pandemic in the second half
o Decisive action taken to reduce costs and keep the workforce and technical competencies together so that the Group can react quickly as markets improve
· Group de-risked
o Receipt of surplus from the successful pension scheme buy out and the sale of the Gamet business and property, has stabilised Group debt levels
o Rationalisation of UK Machine Tool division has reduced operational risk and future capital expenditure requirements
o Move into higher specification work through the acquisition of Control Micro Systems supports gross margin, advances capabilities and brings reduced cyclical customers into the Group
· Group restructure
o Decision taken to expand and enhance operations in the US with new office in Orlando, Florida
o As a result, certain management functions will relocate to Orlando during the course of 2021 but the Group will remain London listed
o Synergies between laser businesses in Ohio and Florida will be realised throughout 2021
o Group CFO, Neil Carrick, has decided that for personal reasons he will be unable to relocate to Orlando and will leave 600 Group at the end of the next AGM
o New CFO appointed with effect from conclusion of AGM
· Macro-economic uncertainty continues but positive long-term fundamentals
o Whilst there continues to be reduced activity, orders have returned to acceptable levels
o Continue to focus on operational efficiencies and increased operational flexibility
o Opportunities to grow and enhance customer offering through investment in new, higher end product capabilities and diversification into new markets
Paul Dupee, Executive Chairman of the Group, commented:
"The Group made significant strides forward in the first half of the year, eliminating the Group's UK final salary pension scheme, significantly de-risking the Group's balance sheet, opening of the new European Technology Centre and acquiring Control Micro Systems, a highly complementary business to the Group's existing laser division, which brings ever more sophisticated, value-added and custom solutions in the use of industrial lasers.
"We have taken the decision to expand our growth in Orlando, Florida. Orlando leads the US in photonics technology and we see exciting opportunities in the region. As a result of the Group's relocation of certain functions, Neil Carrick has decided to leave the business. I would like to personally thank him for all his hard work and great contribution during his time with 600 Group. I am pleased to announce that G.Mitchell (Mitch) Krasny, CPA, will succeed Neil. Mitch brings with him a great wealth of financial and operational experience.
"I would like to thank all our employees for their ongoing support, commitment and dedication to the Group during these difficult times. Their adaptability has helped us to respond quickly and mitigate the impact.
"Despite the short-term end-market weaknesses and macroeconomic uncertainty, the Board continues to believe in the long-term fundamentals of the Group; in brand promotion, investment in new, higher end product capabilities and diversification into new markets and selective acquisitions. We have taken decisive action to ensure that as market conditions improve, we can react quickly."