McBride beats own forecasts with full-year profit growth

17th Sep 2024 10:42

(Sharecast News) - Cleaning goods maker McBride delivered full-year profits slightly ahead of market forecasts on Tuesday and said it remains on track to hit estimates this year on the back of a recovery in the contract manufacturing business.

The company, which makes mostly white-label cleaning and hygiene products but has a small number of its own household brands, reported an adjusted operating profit of £67.1m for the 12 months to 30 June, significantly higher than the £13.5m made the year before.

McBride said in July that adjusted operating profits would be in line with consensus at the time of £66.4m.

Revenues rose 5.2% to £934.8m, driven by a 5.7% increase in sales volumes, with private-label volume growth of 7.2% offsetting lower volumes in contract manufacturing.

However, the second half saw a "strong" recovering in contract manufacturing on the back of an early start of a new long-term contract, with volumes up 13.4% following a fall in the first half.

Looking ahead, the early months of the new financial year have seen overall sales volumes in line with company expectations, with "encouraging signs of continued contract manufacturing momentum".

With a healthy pipeline of new launches and business wins, McBride said the full-year outlook is consistent with current market estimates for an adjusted operating profit of £59.7m, while revenues are expected to build on last year.

"The group has made an encouraging start to the new financial year and while there are signs of increased brander activity, private label demand remains robust with contract manufacturing maintaining the momentum of the fourth quarter. As such, we look forward to the future with confidence," said chief executive Chris Smith.

Shares were up 3.5% at 119.5p by 1127 BST, having now risen 42% since the start of the year.