Midwich Group PLC – Final Results

Midwich Group PLC – Final Results

Midwich, a specialist audio visual (“AV”) distributor to the trade market with operations across the UK and Ireland, Continental Europe and Asia Pacific, today announces its Final Results for the year to 31 December 2018.

Year to
31 December 2018
 £m

Year to
31 December 2017
£m

Total growth

%

Revenue

573.7

471.9

21.6%

Gross profit

94.6

73.1

29.3%

Operating profit

24.7

20.8

18.9%

Profit before tax

21.1

18.9

11.5%

Profit after tax

15.3

14.0

9.3%

Basic EPS – pence

18.53

17.06

8.6%

Adjusted financial highlights1 

Year to
31 December 2018
 £m

Year to
31 December 2017
£m

Total growth
%

Growth at constant currency
%

Revenue

573.7

471.9

21.6%

21.4%

Gross profit

94.6

73.1

29.3%

29.2%

Gross profit margin %

16.5%

15.5%

Adjusted operating profit

30.2

25.0

20.8%

20.9%

Adjusted profit before tax

29.1

24.3

19.7%

19.9%

Adjusted profit after tax

22.3

18.7

19.7%

19.8%

Adjusted EPS – pence

27.28

22.86

19.3%

 1Definitions of the alternative performance measures are set out on page 30 

Financial Highlights

  • Revenue increased by 21.6% to £573.7 million (21.4% on constant currency basis) including organic revenue growth of 8.7%
  • Gross margin of 16.5% (1.0% ahead of full year 2017)
  • Adjusted operating profit1 increased by 20.8% to £30.2 million (20.9% on constant currency basis)
  • Adjusted profit before tax2 improved by 19.7% to £29.1 million (19.9% on constant currency basis)
  • Adjusted PBT has doubled since 2015
  • Adjusted EPS1 increased 19.3% to 27.3p (2017: 22.9p)
  • Final dividend of 10.60 pence per share (2017: 9.65 pence)
  • Total dividend for year of 15.20 pence per share (2017: 13.82 pence) 

Operational Highlights

  • Revenue and net profit growth across all territories
  • Strong full year performance from each of the three businesses acquired in 2017
  • Three successful and earnings enhancing acquisitions completed in the year
  • In-year acquisitions:
    –  Added new product specialisms into European and Asia Pacific territories
    –  Established a presence in South East Asia
  • Expanded central office team improves capacity to acquire, integrate and develop businesses into the Group
  • Good growth of technical products in the year, up 54.7%, assisted by the acquisitions; now representing over 26% of Group turnover
  • Strong growth of core Displays sales, growing 23.7% as a category across the Group

 

Post period Highlights

  • Entered the Italian market and strengthened the audio business through the acquisition of 80% of the share capital of Prase Engineering S.p.A; one of our largest acquisitions to date
  • Established a presence in Switzerland following the acquisition of MobilePro AG 

Stephen Fenby, Managing Director of Midwich Group plc, commented: 

“I am very pleased to report that in 2018 we again achieved strong growth across all the Group’s businesses and regions at both a revenue and profit level. Our organic growth continued to be strong, and we have continued to successfully use targeted acquisitions to drive future growth as well as build our expertise in a broader range of markets and products. We continue to pursue acquisition opportunities that fit within our strategic focus of adding new product ranges, capabilities or geographies to our existing portfolio. 

“We are seeing exciting growth opportunities across all our markets and geographies driven by an increasing demand from end users as well as continued innovation and new products from our manufacturer partners. There is also a continued trend in the increasing use and need for high quality distributors such as Midwich to support the professional AV market. As a result, we continue to exploit a significant number of organic growth opportunities from targeting new vendors while continuing to grow our customer base.  

“The Board is continuing to pursue its established strategy and is pleased with the progress made during 2018.  Trading in the first two months of 2019 has built on the good growth we saw last year, giving the Board confidence in delivering a 2019 performance in line with its existing expectations.”

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