TP Group PLC – Final Results for the year ending 31 December 2018

TP Group (AIM: TPG), the specialist services and engineering group, announces its audited results for the year ended 31 December 2018.

Financial highlights:

• Revenue¹ ahead of forecast and up 40% to £39.0m (2017: £27.9m), underpinned by strong customer momentum during the period
• Of the revenue growth, £5.4m was derived from acquired companies Polaris Consulting (Holdings) Ltd. (“Polaris”) and Westek Technology Ltd.
• Adjusted operating profit² ahead of forecast and up 85% to £4.0m (2017: £2.1m) driven by focus on improving margin and delivery performance
• Operating losses reduced to £nil (2017: £1.0m loss), reflecting one-off acquisition-related expenses and further depreciation and amortisation relating to investments in the business
• Closing cash ahead of forecast at £22.4m (2017: £21.9m), driven by strong working capital performance
• Order intake of £43.2m (2017: £44.7m) and closing order book up 16% to £48.3m (2017: £41.7m)

Operational highlights:

• Polaris now fully integrated, awarded £1m of MoD funding to continue its work on Artificial Intelligence systems
• Acquired Westek Technology Ltd in November 2018, enhancing the Group’s electronic design and packaging capabilities, as well as the addition of major customers specialising in the construction of aircraft and land vehicles
• Signed a five-year framework agreement with Naval Group for work on atmosphere management systems on-board both submarine and surface ships
• The Group’s Advanced Manufacturing Facility in Manchester opened in February 2018, enabling the    Group to deliver complex engineering solutions in high value, premium markets
• Signed partnership agreement with US-based Micropore Inc., affording access to markets and customers   in the UK and in Micropore’s territories
• Continued to grow international presence with established relationships across France, Germany,   Australia, the Middle East and South East Asia
• The Group is ideally placed to capitalise on the substantial opportunities in our markets and is focused on delivering another solid year of progress, both organically and by acquisition.

Phil Cartmell, Chief Executive Officer of TP Group, commented:

“2018 has been an excellent year for TP Group. We now have a business of significant scale and international reach, which we fully intend to leverage over the coming years. As we enter the next phase of our plan and engage more actively with customers and partners overseas, we envisage the Group will grow further, extending into new geographies and sectors.

“We have seen a strong start to 2019 supported by a large order book, which has grown substantially since last year.

“We continue to invest in the growth of our business, remain excited by the global market opportunities and are focused on delivering further shareholder value.”

Additional narrative to the results will be published in the Group’s Annual Report and Accounts that will be available in due course on the Company website at:

https://www.tpgroup.uk.com/investors/results-reports-presentations/

 ¹  2017 revenue has been restated to reflect the impact of IFRS 15
²  Adjusted operating profit is defined as operating loss adjusted to add back depreciation of property, plant and equipment and right-of-use assets, amortisation of intangible assets and impairment gains or losses on non-current assets, changes in fair value of contingent consideration, acquisition consideration accounted for as employment costs owing to on-going service conditions, any other acquisition-related charges, share based payment charges and non-operating costs. Non-operating costs are those items believed to be exceptional in nature by virtue of their size and or incidence. The directors of the Company believe this measure is more reflective of the underlying performance of the Group than equivalent GAAP measures. This is primarily due to the exclusion of non-cash items, such as share-based payments, impairment, depreciation and amortisation, as well as acquisition and non-operating costs. This provides shareholders and other users of the financial statements with the most representative year-on-year comparison of operating performance. This measure and the separate components remain consistent with 2017.