Castings plc is a market leading iron casting and machining group based in the UK, supplying both the domestic and export markets. The company is listed on the LSE main market and has a market cap of £180m. Full year results to 31st
March 2023 were released on 15th June.
We were delighted to welcome the CEO, Adam Vicary and FD, Steve Mant, to a webinar for private investors to talk about the excellent recent full year results and the prospects for 2023 and beyond . A recording of the webinar is available here.
By way of a short introduction, Castings is a foundry business which was founded in 1835 in the West Midlands and has grown over time both organically and through two key acquisitions. The current organisation is structured into three operating businesses. The original Castings business is based at the Brownhills foundry in the Midlands, the machining business is based on the same site and was acquired in 1996 and the largest foundry, William Lee, is located at Dronfield in the Peak District. Castings still melts, pours into sand moulds and machines or finishes iron castings.
The full year results to 31 March 2023 was the best performance in a number of years. The company produced and despatched 53k tonnes of product, an increase of 6.6%, the highest in its history. Revenues grew 35% to £201m and underlying revenue growth, excluding the impact of energy surcharges grew 24%. Operating profits were up 36% to £16.4m and the company ended the year with net cash of £35.6m. Confidence in the future was underlined via a total dividend of 17.35p an increase of 6.9% and the declaration of a special dividend of 15p. The dividend has now been raised or maintained for 42 years.
The company was able to pass on to customers significant increases in energy, labour and other costs. Energy cost increases of £30m were passed on in their entirety but this did have a negative impact on the percentage margin. The machine shop returned to profit and it is expected that margins will continue to improve in the current year. There were some production issues earlier in the year which had a negative impact of £500k on profits but these have now been resolved. Demand from the US was strong as was growth in non-truck operations including wind energy, truck & trailer breaking and…
