Portmeirion buoyed by strong US trading, shares jump

18th Jul 2024 09:51

(Sharecast News) - Shares in Portmeirion Group rallied on Thursday, after strong trading in the US saw the ceramics manufacturer reiterate full-year guidance.

The AIM-listed firm, which owns Spode, Royal Worcester and home fragrance brand Wax Lyrical, among others, said sales in the traditionally quiet first half were down 17% at £36.5m year-on-year, in line with expectations.

The fall was attributed to lower order levels in South Korea, where softer consumer spending was compounded by significant de-stocking and tough comparatives. Sales slumped 60% in the country.

Once the impact of South Korea was stripped out, group sales rose 5%.

However, sales in the US - Portmeirion's largest market - rose 4% on a constant currency basis, with gross margin also stronger.

The UK, meanwhile, benefited from strong Wax Lyrical sales, after the brand won new listings in the grocery channel.

As a result, Portmeirion reiterated its full-year guidance, noting: "We expect 2024 to be up on the prior year, with improved operating margins, and remain on track to meet market expectations.

"We expect sales in the second half in our South Korean market to be back broadly in line with the prior year, and we have healthy order books for Christmas across the US and UK."

As at 0945 BST, shares in the Stoke-on-Trent firm were up 11% at 232.96p.

Mike Raybould, chief executive, acknowledged that consumer markets remained "uncertain" around the world.

But he continued: "We are encouraged by our advance US orders for Christmas, which remain significantly ahead of last year.

"The benefits of our cost restructuring are on track, and this supports our commitment to growing our operating margins in the short and long-term. We believe that our increasingly distributed brands are well-placed to grow in the medium and long-term."

Portmeirion is due to publish results for the six months to 30 June in the second half of September.