Mannok increases its earnings in 2020 despite challenges

Mannok’s 2020 performance review showed a robust post lockdown recovery and a positive outlook for 2021, with the company posting an increase in earnings (EBITDA: Earnings Before Interest, Tax, Depreciation & Amortisation) of 17% to €31.1 million for the 12 months ending 31 December, 2020.

The strong performance comes despite the unprecedented twin challenges of COVID-19 and Brexit during the period, which included a halt on all non-essential production at the company’s multiple manufacturing plants during Q2.

Last year also saw the company take on a rebrand from Quinn to Mannok, marking the culmination of a six-year transformation and investment programme that saw sales and employment increase by 44% and 25% respectively.

Mannok’s significant investment continued, to the tune of €6.7 million in the period, bringing total investment to €66 million since the acquisition of the businesses in December 2014.

Performance highlights:
EBITDA increased from €26.6 million to €31.1 million. Revenue remained materially consistent at €233 million, demonstrating strong resilience to the impact of COVID-19 on trading during the year.

Last year saw good sales and margin increases across cement and packaging, partly offset by higher raw material costs for Insulation products.

Cash generation from operating activities improved by over 44% from €21.7 million to €31.3 million, which aided a reduction in net debt in the period of €19.4 million.

Investment of €6.7 million in the period, primarily in manufacturing technology and capacity enhancement was achieved, bringing the total investment to €66 million since the acquisition of the businesses in December 2014, with a further €6.1 million of investment already in train for 2021.

Commenting on the report, Liam McCaffrey, chief executive officer of Mannok, said: “Careful resource planning and operational agility, facilitated by the significant investment we have made in our sales support, logistics and customs management infrastructure, have ensured uninterrupted supply chains for our customers across the construction and food industries in the UK and Ireland.

“Post the initial lockdown, trading recovered strongly in the second half of the year, supported by approximately €66 million of new investment over the past six years. While the business has experienced some impact on trading activities over recent months, with several customer projects being delayed due to COVID, underlying demand has remained strong.

“Given our ongoing exposure to the food and construction sectors, the very positive response to our rebranding and the potential tail-wind of a vaccine-driven economic recovery, the outlook for 2021 is positive.”

Dara O’Reilly, chief financial officer, added: “Through timely adjustment to our manufacturing levels during the initial lockdown, we succeeded in managing our cost base and resource allocation, whilst ensuring seamless supplies to essential industries.

“We continue to monitor our markets very closely, as well as the supply of key input materials for our insulation and packaging businesses. Notwithstanding a positive outlook and good demand, we are expecting some margin compression because of inflationary cost pressures in 2021.”