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Fox Marble Holdings

Fox Marble Holdings PLC Q&A: Final results (LON:FOX)

Fox Marble Holdings plc (LON:FOX) Chief Executive Officer Chris Gilbert caught up with DirectorsTalk for an exclusive interview to discuss the key factors of their final results, progress in 2019 and what we can expect going forward.

Q1: Final results for the year ended 31st December 2018 out, can you tell us what the key factors were that drove your results for 2018?

A1: Yes, I think the way to look at this is this is a year where we have consolidated a lot of the production issues or were consolidating a lot of the production issues that we’d previously had and that our job was to build the machines such that we can satisfy the demand that we have created. We talked earlier in the year about the fact that towards the end of the year, we were in a position where our demand exceeded our abilities to supply.

So, whilst the numbers look relatively restrained in terms of what they were before, if you include the advances that we were paid on contractual sales that we’d made, our revenue was up €1.2 million to €1.7 million and our tonnage was 20and higher than it was the year before.

The other piece of the equation is since the factory came online last year, we were able to transact 7,000 square metres of processed material and I think the year before that it was significantly lower.

As a consequence of this, we can see that the business is building albeit I think probably at a slower level than people would’ve liked to see but there’s a lot that you can’t see that’s been taking place, particularly towards the end of the year which we’ll start to come through this year.

Q2: Can you describe then the progress in 2019 that you can talk about?

A2: Just to give you one key metric for example, in Q1 of 2018 our total sales were under €100,000, our sales in Q1 of 2019 were over €500,000, that’s 6 times as much as it was in the same period of last year. So, that reflects a very very strong start to the year and given that includes the period where the quarries are shut down because of the normal winter shut down, that’s a spectacularly strong start to the year and a very good result.

Of course, what drives this is our capacity to produce so our production figures for that period in 2018 were just over 2,000 tonnes and our production figures for the same equivalent period this year in 2019 is just under 6,000 tonnes, that’s 3 times as much. This significant increase in production is a reflection of the capital investment that we’ve made specifically in the quarries to increase production and that is driving through now to the bottom line which I think is what 2019 is all about.

Q3: How has Fox Marble progressed from your perspective?

A3: The topline figures, as I’ve just described, I think speak for themselves. The underlying progress that we, as a company, I think are going to be able to demonstrate to the market and everybody more widely is that our marketing, sales and distribution platform is far more robust than it has been in the past, we have got multiple customers in lots of parts of the world and repeat ordering on a regular basis.

So, for example, yesterday I had 2 customers in our office here from Greece who were saying “we want 300 tonnes of your marble as a minimum from one of our quarries – the quarry in Macedonia – every month. We want to know that we can show up on the 25th of every month and take our 300 tonnes and that we can do this every month with a degree of certainty” so that level of certainty and security from our customer point of view is very important

From our point of view, it means we can plan for a number of customers coming into the quarries on a regular monthly basis and taking off, under the contractual relationships we’re entering into with them, specific amounts of material for which they pay in advance and that brings stability that we’ve been working towards.

So, that stability, that level of visibility that we can have throughout the course of the year, we know who these customers are, these are large credible customers that anybody would be pleased to have, bluechip in the stone industry, is what any quarrying and processing company would like to have.

We’re establishing these relationships and we’ve got them now and that’s the key progress rather than ad hoc or random sales that we were experiencing a couple of years ago, it’s not like that now and that I think is the key progress for us.

Q4: What can we expect from Fox Marble for this year?

A4: We have announced a couple of significant contracts and we are going to continue to announce contracts that range from very prestigious contracts relating to signature buildings and projects that anybody would be pleased to be involved with to these long term off-take agreements with the visibility and stability of a regular monthly distribution and shipping of material.

I think we’re going to be able to announce these regularly throughout the course of the year to the market and people I think will then start to understand the real progress that the company has made over the last 18 months to 2 years that’s gone into establishing the position we’re in right now.

We’re relatively pleased so come the end of the year, we’d like to be in a position for that to have reflected through to the bottom line and everybody can basically see the money which is of course what everybody is waiting for.

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