Volution Group (FAN) Trading Update summary

Financial performance and outlook

• Adjusted earnings per share for FY24 expected to be slightly ahead of current market forecasts, with consensus at 26.9p.

• Group total revenue growth on a constant currency basis projected at over 7%, with organic growth slightly over 1%.

• Group adjusted operating margins anticipated to improve to around 22% (2023: 21.3%).

• Operating cash conversion expected above 90%, with leverage at 31 July 2024 forecast at approximately 0.5x.

• Ample headroom for further earnings-accretive acquisitions entering FY25.

Regional and segment performance

• UK residential revenue grew strongly, driven by public RMI demand and regulatory support for low-carbon solutions.

• UK commercial and OEM segments experienced weakness, but year-on-year declines are stabilizing.

• Continental Europe growth supported by acquisitions; organic revenue broadly flat, with strong performance in ClimaRad and improved German refurbishment.

• Australasia saw small organic growth, with Australia gaining share and New Zealand facing a challenging market.

Operational initiatives and strategic progress

• Focus on insourcing, value engineering, and factory efficiency supported margin improvement.

• Three recent acquisitions have integrated well, with new product and cost initiatives underway.

• Refurbishment and improvement activities, about 70% of the Group, showed resilience despite market challenges.

• New build activities underpinned by regulatory drivers and demand for advanced ventilation in low-carbon buildings.