By Christian Moess Laursen
Ultimate Products, a leading U.K. mass-market consumer goods company, has announced that it anticipates its fiscal-year profit performance to align with current market expectations. Additionally, the company has revealed plans to implement share buybacks as part of its new capital allocation policy.
In the first half of the fiscal year, which ended on January 31, Ultimate Products experienced a 4% decrease in revenue, amounting to £84.0 million ($106.1 million). This decline was primarily attributed to supermarket orders being affected by overstocking issues. However, as the situation stabilizes and retailers normalize their stock positions after the busy Christmas trading period, the company expects to see a positive shift in order trends during the second half of the year.
Ultimate Products credits the improvement in operating margins to the automation of numerous business tasks and the lower freight rates it enjoyed during this period.
Looking ahead, Ultimate Products forecasts its full fiscal year’s performance to align with the current market forecasts of £21.6 million in adjusted earnings before interest, taxes, depreciation, and amortization.
To provide value to its shareholders, Ultimate Products plans to allocate around 50% of after-tax profits through dividends and complement this with share buybacks. Detailed information regarding the formal buyback scheme will be communicated in the near future.