Flooring group Headlam says it is looking to return cash to shareholders while its search for a chief executive is making progress.
The group repeated its November forecast of sales of £667.2m for 2021 (2020 £578.1m) with underlying pre-tax profits expected to be slightly ahead of market expectations of £35m. Both the UK and Continental Europe ‘performed well’, up 16.5% and 15.1% respectively against 2020 on a like-for-like revenue basis.
‘Actions taken under the business change programme helped to improve operating efficiency and operating margin during the year, with strong cash generation. Closing net funds was in excess of £53m, with this being comfortably above the company’s current capital requirements, which includes increased investment to drive revenue growth and optimise operating performance. Given this, the company’s ongoing strong cash generation profile, and having reference to previously published capital allocation priorities, the company is considering a potential surplus return,’ it says.
The scale and type of pay-out will be announced with its final results in March.
‘Early trading in 2022 has been encouraging, and the company has continued to be able to largely mitigate the persisting industry wide supply issues and associated inflationary pressures and is in the latter stages of the independent search process for the appointment of the chief executive.’
