Interim Results 2019


Further good progress with revenue growth of 16.3% and adjusted operating profit up 10.7%.

Volution Group plc (“Volution” or “the Group” or “the Company”, LSE: FAN), a leading supplier of ventilation products to the residential and commercial construction markets, today announces its unaudited interim financial results for the 6 months ended 31 January 2019.

Financial Results 6 months to 31 January 2019  6 months to 31 January 2018 Movement
Revenue (£m)




Adjusted operating profit (£m)




Adjusted profit before tax (£m)




Reported profit before tax (£m)




Adjusted basic and diluted EPS (p)




Reported basic and diluted EPS  (p)




Adjusted operating cash flow (£m)




Interim dividend per share (p)




Net debt (£m)





The Group uses some alternative performance measures to track and assess the underlying performance of the business. These measures include adjusted operating profit, adjusted profit before tax, adjusted basic and diluted EPS and adjusted operating cash flow. For a definition of all the adjusted and non-GAAP measures, please see the glossary of terms in note 20. A reconciliation to the reported measures is set out in note 4.

Financial highlights

  • Revenue growth of 16.3% (17.8% at constant currency).
    • Organic revenue growth of 1.9% (3.2% at constant currency).
    • Inorganic revenue growth of 14.4% (14.6% at constant currency).
  • Adjusted operating profit increased by 10.7% to £20.2 million (12.4% at constant currency), assisted by acquisitions.
  • Adjusted operating profit margin declined by 0.9 percentage points resulting from:
    • operational difficulties at our Reading facility which improved significantly by the end of the period; and
    • higher material cost in OEM (Torin-Sifan) and our UK Commercial sector.
  • Reported profit before tax of £10.2 million (H1 2018: £10.1 million), increased less than adjusted operating profit due to:
    • release of £1.5 million contingent consideration in the prior period;
    • amortisation of acquired intangible assets increased by £0.5 million; and
    • offset by lower financing costs and foreign exchange derivatives revalued in the period.
  • Adjusted operating cash inflow of £15.5 million (H1 2018: £11.8 million) as a result of higher adjusted profitability and improved working capital management compared to the prior period.
  • Net debt of £74.4 million was £39.5 million higher than at 31 January 2018 following £51.0 million spent on four acquisitions completed in H2 2018.
  • Interim dividend of 1.60 pence per share, up 9.6% (H1 2018: 1.46 pence).

Strategic and operational highlights


  • The four acquisitions completed in the prior year are all integrating and performing well. These acquisitions have both extended our geographic and product reach, further diversifying and increasing Volution’s market access.

Organic growth

  • Organic growth highlights in the UK include a return to growth for the UK Public RMI sector and another period of strong organic growth for UK Residential New Build.
  • Operational difficulties at our Reading facility adversely impacted on profitability in the period; however, we are pleased by the significant improvement in production levels by the end of the period, which has been sustained into the second half of FY 2019.
  • Good traction with our new Xenion range of decentralised heat recovery ventilation in Germany with a substantial increase in gross margin.
  • The launch of the first application software controlled ventilation extract fan, Genius, under the Manrose brand sold by our company Simx in New Zealand, further demonstrating our capability to launch existing Volution products in to newly accessed markets.

Post period event, acquisition of Ventair Pty Limited in Australia

  • On 1 March 2019, we acquired Ventair Pty Limited, a market leading residential ventilation product supplier, in Australia, for an initial cash consideration of AUS$19.2 million (approximately £10.4 million). A further amount of deferred cash consideration of up to AUS$7.7 million (approximately £4.3 million) may be payable contingent on Ventair achieving an EBITDA target in the financial year ending 31 July 2020.
  • The acquisition of Ventair Pty Limited has further increased our geographic diversity, product offer and market access; including the pro-forma effect of this acquisition, our revenue from customers outside the UK now represents 53% of total Group revenue.

Commenting on the Group’s performance, Ronnie George, Chief Executive Officer, said:

“I am pleased to announce these results which are underpinned by strong growth, in line with our strategy, as a result of the four acquisitions completed in FY 2018, and our much improved run-rate of organic growth compared to the second half of FY 2018. Organic growth in the UK was considerably improved compared to the second half of 2018, assisted by the return, as the period progressed, to normal production levels at our new injection moulding and fan assembly facility in Reading, UK. Our Residential Public RMI revenue returned to organic growth as our new products and enhanced specification sales teams continued to win market share. All four acquisitions completed in FY 2018 are integrating well. In the Australasian region we have complemented our Simx business in New Zealand, by the post period acquisition of Ventair in Australia, providing additional market access and product range in Australasia.”


The second half of the financial year started well, continuing the improving organic growth trend demonstrated in the first half. The factory consolidation project, in Reading, UK, is now complete; production levels had normalised by the end of the period and we expect to benefit from these increased levels of output in the second half of FY 2019. Notwithstanding the ongoing uncertainty over the arrangements for the UK to leave the EU, we are now significantly more geographically diverse, and our increasing investment in innovation and new product introductions will provide the support required to make good progress in line with our strategy in the second half of the financial year. The Board currently anticipates full year earnings to be in line with expectations.