# Accrol Group on track and revenue up 64%

- Link: https://www.directorstalkinterviews.com/accrol-group-on-track-and-revenue-up-64/4121091080
- Published: 2022-11-21T07:23:51+00:00
- Author: Giles

**Accrol Group Holdings Plc** ([LON:ACRL](https://www.directorstalkinterviews.com/company/accrol-group-holdings/acrl.l)),
the UK’s leading independent tissue converter, has announced the following trading
update ahead of its Half Year Results for the six months ended 31 October 2022, 
which are scheduled to be released in late January 2023.

The Board is pleased to report that the Group performed strongly in H1 FY23, delivering
substantial growth in volume, revenue and profit, as well as further strengthening
its market position. The Group continues to demonstrate its resilience against the
challenges of input cost inflation, successfully leveraging its supply position 
with customers to recover all additional costs in the Period.

Net debt at 31 October 2022 was lower than anticipated at c.£30.5m, despite a significant
increase in tissue stocks as the Group continued to manage uncertainty in its supply
chains and the effect of strikes at UK ports.  The Group expects this working capital
position to improve in H2 FY23 to deliver a further reduction in its net debt position
ahead of current market expectations* for FY23.

**H1 FY23 highlights:**

| ● | Revenue up 64% to £121.1m (H1 FY22: £73.7m), with volumes increasing by 14% in the Period | 
| ● | Accrol’s market share by volume increased further to c.21.5% (FY22: 19.5%), compared to a flat overall UK market | 
| ● | As announced in the Group’s Final Results FY22 in September, private label volumes are now higher than pre-pandemic levels – market share growing at an unprecedented rate against that of the traditional brands (Q1 FY23: 54% vs Q1 FY22: 50%) | 
| ● | Private label sector has strengthened further since the Final Results and Accrol volumes have continued to grow ahead of overall UK market with private label market share standing at c.46% (FY22: 44%) |

**Outlook**

The Group’s main market, the discount retailers and private label products continue
to grow strongly, driven by the cost-of-living crisis.

The Group has delivered substantial growth in the Period and the Board is increasingly
confident that the growth trajectory of the business is sustainable. The volume 
growth in H1 FY23 is expected to continue as consumers move away from high-cost,
low-value branded products in search of best-value.

Whilst mindful of the wider economic uncertainties, the Group’s model is robust,
and the Board considers the Group to be on track to deliver results for the full
year ended 30 April 2023 (“FY23”) at least in line with market expectations* with
net debt reducing ahead of expectations to c.1.5x EBITDA by the end of FY23 (FY22:
3.0x).

_* For the purpose of this announcement, the Group believes market consensus for
FY23 to be revenue of £213.5m, adjusted EBITDA of £15.0m, adjusted PBT of £7.1m 
and net debt of £26.3m._

> **Gareth Jenkins, Chief Executive Officer of Accrol Group, said:**
> “We are clearly very pleased with these set of results where we have seen volume
> growth of 14% against a flat overall UK market performance over the same period.
> We have delivered this by having great quality and value products that meet every
> consumer’s budget. Our strong relationship with the retailers and our robust supply
> model is ensuring we can continue to deliver a strong set of results in a difficult
> market environment.”

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