AGA RANGEMASTER GROUP PLC ("the Group")
Profit growth achieved and AGA Total Control launch well received
AGA Rangemaster Group plc, the range cooker and kitchen living specialist, today provides a trading update ahead of its interim results for the six months ended 30th June 2011 to be announced on 26th August 2011.
The Group has had a solid first half to the year. Good operating profit progress was made even though housing-related consumer expenditure remained subdued. Revenues were slightly lower but margins improved, particularly in parts of the Group that had been weaker performers. Net cash balances have increased year-on-year.
Rangemaster cooker volumes were, overall, slightly down because of the relatively quiet UK market. Exports continued to achieve new record levels on the continent.
The Group is now seeing the benefit of decisive management action taken at Fired Earth. The run rate of losses has fallen sharply. A clear plan with a strong incentive structure is in place to improve performance over the next three years. For AGA Marvel in North America demand remains subdued and the onus remains on programmes to widen the customer base using, in particular, a new range of premium undercounter refrigerators. Profitability has improved following the rationalisation of Heartland cooker production and the cold lines of Marvel into the one Greenville, Michigan production, distribution and service support facility.
The major development for the Group in the first half of the year was the UK launch of AGA Total Control which was very well received. It will be launched this autumn in international markets.
The flexibility of the AGA Total Control - "On when you need it; off when you don't" - is attracting new customers to the radiant heat cooking of cast iron ovens and the sales to owners trading up continues to rise. AGA Total Control will bring renewed sales momentum for AGA in the second half of the year and is central to our strategy to grow cast iron cooker sales substantially.
Cash flows remain carefully managed and working capital ratios are now in line with long run objectives. At 30th June 2011 net cash was in excess of the £22.4 million balance of a year ago.
William McGrath, Chief Executive commented: "In the current market we are pleased with our performance, strong cash balance and market leading positions. Looking forward we are excited about the growth opportunities for our new products led by AGA Total Control which epitomises our plans for the future."
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Simon Sporborg/Charlotte Kenyon, Brunswick Group - 020 7404 5959