Morgan Advanced Materials revenue up by 0.2% in 2023

2024-03-13

Mar. 12, 2024 - Morgan Advanced Materials today annuances the financial result in 2023. Group revenue was £1,114.7 million (2022: £1,112.1 million), an increase of 0.2% on a reported basis compared with 2022. On an organic constant-currency basis revenue increased by 2.5%. Adjusted operating profit £120.3m, a decline of 20.3% on a reported basis.

Group highlights:

Organic constant-currency revenue growth of 2.5%, with 10.4% from our faster growing markets
Adjusted operating profit £120.3m, adjusted operating profit margin 10.8% and ROIC 17.6%
Recovery from cyber security incident now substantially complete
Cash generated from continued operations of £126.3 million, reflecting full recovery of the mid-year increase in working capital
Strong balance sheet with net debt*/EBITDA (excl. leasing) of 1.2 times
Absolute CO2e emissions (from scope 1 and 2) reduced by 25% compared with 2022
Simplification of Group structure announced alongside additional cost reduction programme
Further market demand driving an acceleration of Semiconductor investment, with higher medium-term Group growth now expected
Underlying outlook for 2024 performance unchanged, foreign exchange headwind anticipated

Commenting on the results, Chief Executive Officer, Pete Raby said:

"Our product differentiation and successful business model have enabled us to deliver solid revenue growth in both our Core and Faster Growing markets, despite the impact of the cyber security incident in the first half and weaker market conditions in the second. We have substantially completed our recovery from the cyber security incident, with our profitability and cash performance in line with our financial framework in the second half.  We are pleased to be able to announce an acceleration of our Semiconductor capacity investment, and a simplification of the Group that supports a leaner structure as we enter 2024. I want to thank all our employees for their hard work in achieving this result."

Outlook

Whilst mindful of weaker market conditions in the near term, our outlook for full-year constant currency revenue growth remains in line with our financial framework.  We expect our restructuring plan to deliver initial cost benefits in 2024, whilst we are also accelerating our investment in Semiconductor capacity as we ramp up to meet strong demand, and increasing our investment in IT.  Our underlying outlook for 2024 performance is unchanged, with a slight weighting to our second half as additional capacity comes online, and a foreign exchange headwind anticipated.