Midwich defies Brexit buffeting to fashion growth springboard
Higher sales in Germany and France allied to a bounceback in the UK and Ireland has helped Norfolk-based AV tech company Midwich to strong revenue growth in the first half to end-June.
Shortages of products are worsening but Midwich believes this is temporary and is predicting further revenue increases in the second half. The interim results triggered a modest increase in UK share price to 618p.
H1 revenue rose 29.2 per cent to £390.1 million, reflecting the strength of the ongoing recovery from the impact of Covid-19.
Trading since period-end has been in line with the board’s expectations and well ahead of the comparative period.
Managing director Stephen Fenby, said: “I am very pleased with the group’s performance in H1 2021, particularly given significant lockdowns in a number of key territories early in the period.
“The trading momentum seen in the second half of 2020 continued. Organic growth was 25.6 per cent.
“Trading in EMEA showed the greatest improvement, particularly in Germany and France. After a slow start due to a severe lockdown, the UK and Ireland division improved strongly across the period, with revenues in the month of June 2021 reaching the 2019 level.
“Acquisitions made strong positive contributions in the period and we have seen a significant number of new opportunities presented.
“The higher margin live events and hospitality markets are starting to recover in a number of territories, although we believe there is still a considerable way to go.
“The recovery of the corporate market has been slightly slower than expected, as corporates have in some cases deferred their return-to-office plans.
“There is a more significant level of enquiries and activity in this market, and we now expect that this will start to be converted into orders and revenue in early 2022.
“The board believes that the group’s markets and business should continue to improve steadily across the remainder of 2021 and into 2022, although there remains a risk of negative impact due to further lockdowns.
“Shortages of product appear to be worsening and are having a dampening effect on revenues, albeit such impacts should be temporary and not affect the general growth trajectory of the business.
“Trading since the end of H1 has been in line with board expectations. Order books have continued to strengthen and, barring significant lockdowns in key territories, the board expects trading to be comfortably ahead of its previous expectations.”