Mpac Group PLC on Wednesday reported a plunge in its annual profit as costs rose. and announced the retirement of its chief executive officer Tony Steels.
Shares were down 10% at 252.00 pence each on Wednesday morning in London.
The Tadcaster, England-based packaging and automation company said 2022 revenue was up 3.6% to £97.7 million from £94.3 million in 2021. Mpac noted strong recovery of performance in the second half of the year driven by ‘unwinding of supply chain issues and cost saving mitigations’.
Pretax profit, however, fell to £200,000 from £8.2 million, as Mpac made no operating profit for 2022 but in 2021 it made £8.3 million.
Cost of sales rose to £73.3 million from £65.4 million, and distribution expenses widened to £8.1 million from £6.8 million.
Underlying pretax profit was £3.5 million, down from £8.6 million a year earlier.
Order intake amounted to £83.8 million, down from £117.9 million in 2021.
Chief Executive Officer Tony Steels said: ‘Mpac once again demonstrated its agility in implementing mitigations to deliver a second half recovery. This was in the face of increased macro-economic uncertainty and unprecedented volatility in the global supply chain which impacted both the lead time of customers’ order placement and caused operational challenges. The group ended 2022 with a strong closing order book and a healthy prospect pipeline, providing good coverage over 2023 forecast revenue.’
Looking ahead, Mpac said it started 2023 in line with expectations with ‘encouraging order intake’ and believed that its long-term prospects are positive. But it warned that rising energy costs, higher interest rates, skilled labour shortages, and semi-conductor supply constraints will continue into 2023, which it said ‘sets the context’ for customer investments and decision-making.
Additionally, the company said Chief Operating Officer Adam Holland will succeed Tony Steels as chief executive.
Holland joined in November last year from auto dealership firm JCB Group.
Steels will retire from the company after being CEO for more than six years. Mpac said there will be a handover period, with Steels formally stepping down on May 17.
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