McBride cautious amid lockdown, Brexit unknowns

Manchester-based household cleaning products firm McBride plc said on Monday it has a cautious outlook “in light of the potential for future operational challenges resulting from Covid-19, the uncertainty arising from the Brexit process and the unknown impact on consumer demand from renewed lockdowns in our principal markets.”

In an AGM statement, McBride said it expects “a modest improvement in year‑on‑year profitability.”

McBride’s biggest shareholder is activist hedge fund Teleios Capital Partners with 23.71%. Duke University Management Company (DUMAC) owns 16.80% and Zama Capital Advisors own 10.34%.

The company is one of Europe’s largest makers of retailer own brand household goods.

McBride said: “The early part of the financial year has experienced demand patterns similar to those seen in the COVID-19 affected last four months of the year ended 30 June 2020.

“Changes to consumers’ behaviours seen in the earlier stages of the pandemic have largely continued with strong demand for bleach, auto-dish and surface cleaning products offset by lower demand for laundry products. 

“Both the Aerosols and Asia units have experienced strong revenue growth.  

“Total revenues are broadly flat after the first four months and are expected to show modest growth for the first half of the year. 

“Earnings growth is expected to be weighted to the first half of the year, reflecting weak comparatives in the prior period and improved margins from efficiencies, lower operating costs as well as lower input costs for certain raw material and packaging items.

“Whilst all factories are currently operating as normal and the supply chain for inbound and outbound materials is functioning well, the board’s full year view is cautious in light of the potential for future operational challenges resulting from Covid-19, the uncertainty arising from the Brexit process and the unknown impact on consumer demand from renewed lockdowns in our principal markets.

“Our full year outlook on trading therefore remains unchanged, with our current expectations for a modest improvement in year‑on‑year profitability.”

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