Company Announcements

Electrocomponents plc today issues a trading update for its first quarter ended 30 June 2020

·      Our business model has proven resilient during the COVID-19 crisis. All our distribution centres remain operational and, through our digital capabilities, we have been able to continue to deliver a reliable service to customers and suppliers.

·      Q1 revenue declined 11% on a like-for-like basis with trading trends improving across the quarter as mobility restrictions eased in our key markets. The Group exited the quarter with a like-for-like revenue decline of 7% in June.

o  EMEA saw the most significant improvement across the quarter with continued share gains, while Americas has seen more limited recovery to date.

o  Asia Pacific saw continued growth in Greater China and Australia offset by the impact of lockdowns in other markets.

o  Digital revenue declined 12% on a like-for-like basis. Website revenue performed closely in line with the Group trend, however, e-procurement revenue underperformed due to temporary reduced demand from some key corporate customers.

o  RS PRO revenue declined 3% on a like-for-like basis, with a return to growth in June.

·      We continue to take actions to maintain, and where possible improve, gross margin.

·      Cash collection is being monitored closely and, to date, we have not seen any significant adverse impact from COVID-19 on receivables collection. 

·      We have further strengthened the balance sheet, signing an additional £100 million facility with our relationship banks on 2 June 2020 to extend our total committed facilities to over £450 million, of which around £290 million remains undrawn. We remain confident that we have sufficient liquidity under a range of demanding scenarios.

·      We continue to closely monitor the evolving COVID-19 crisis and ensure we balance the needs of all our key stakeholder groups in our response:

o  Prioritising the health and safety of our employees as we cautiously reopen offices.

o  Maintaining a reliable service to our customers and suppliers.

o  Continuing to play an active role in our communities and in the fight against COVID-19.

·      Given the current operating environment remains uncertain, we remain highly focused on protecting profit and conserving cash. We are making good progress on our work to further simplify our operating model which we expect to drive significant savings in the medium term. We are also accelerating key strategic initiatives to drive scale and efficiency to ensure we continue to gain market share and come out of this crisis well positioned for long-term value creation.

LEI: 549300KVXDURRKVWR37

Enquiries:

Notes:

1.        Like-for-like revenue growth is growth in revenue adjusted to eliminate changes in exchange rates and trading days year on year. 2020 is converted at 2021 average exchange rates for the period.

2.        Our profit remains sensitive to movements in exchange rates on translation of overseas profits. Average exchange rates for the year ended 31 March 2020 for euro and US$ respectively were €1.14 and $1.27 respectively. Every 1 cent movement in the euro has a circa £1.4 million impact on annual profit. Every 1 cent movement in the US $ has a circa £0.5 million impact on annual profit.

3.        In the year ending 31 March 2021 we expect to see a negative impact of around £3 million on revenue from fewer trading days compared with the year ended 31 March 2020.