Stelrad delivers hot performance in 2022
( ), a manufacturer of central heating radiators, announced audited results for the year ended 31 December 2022.
The company reported a revenue increase of 14.6% year-on-year to £312.1m, and an adjusted profit increase of 12.9% to £24.3m. Total dividend per share rose 8-fold to 7.64p.
However, adjusted free cash flow decreased by 18.9% to £17.2m from £21.2m in 2021 and net debt increased to £68.4m from £40.9m a year ago.
Statutory profit for the year decreased 70.6% to £4.3m from £14.7m. This was the result of Stelrad having to adopt IAS 29 reporting in respect of its Turkish subsidiary due to inflation in Turkey exceeding 100% over a 3-year period. IAS 29 reporting resulted in a non-cash item with a £16.3m negative impact on statutory profit.
For 2023, IAS 29 will not be applied as Stelrad switched to Euro for its Turkish business.
All figures given below are adjusted, pre-IAS 29.
In the UK & Ireland, Stelrad recorded 6.5% revenue growth and 5.2% growth in adjusted operating profit. In Europe, revenue rose 25.3%, with 7.3% growth in adjusted operating profit. In Turkey & International, revenue grew 6.4%, with a 29.1% reduction in adjusted operating profit.
Contribution per radiator increased by 18.6% LFL, offsetting a 9.2% year-on-year sales volume decline (15.3% LFL).
Stelrad acquired Italian manufacturer of heat emitters, DL Radiators, for €28.3m in July 2022.
View from Vox
Stelrad managed to deliver record performance for the 2nd year in a row despite supply chain disruptions and material and labour cost inflation that plagued the industry in 2022. The company's operational improvements and margin management measures implemented during the period helped it weather the macroeconomic headwinds.
Despite a reduction in volumes of 9.2% in 2022 (15.3% LFL), Stelrad's revenue (pre-IAS 29) increased by 14.6% to £312.1m while adjusted operating profit increased 2.4% year-on-year to £34m.
Stelrad's outlook for FY23 remains in line with market expectations. The company reiterated its commitment to efficient heating, expressing confidence that it is well-positioned to deliver value from decarbonisation.
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