Luceco reports steady Q3 growth, optimistic for 2025

On Thursday, Luceco plc, a prominent supplier of wiring accessories, EV chargers, LED lighting, and portable power products, reported a 3.0% year-on-year revenue growth for the third quarter ended September 30, 2024. The Group has also seen a year-to-date revenue increase of 6.4%. This growth comes despite a slight 3.6% dip in like-for-like Q3 revenue. Nevertheless, a strong fourth-quarter order book is expected to bolster like-for-like revenue growth in the second half of the year.

The Group's residential divisions, which account for approximately two-thirds of its sales, have experienced encouraging growth. This has offset a decrease in infrastructure revenue, which represents about 15% of sales and is subject to individual project timings. Notably, Luceco's Residential EV Charging business surged by 44% compared to the same quarter last year.

Luceco's recent £30 million acquisition of CMD, a leading designer and manufacturer of workplace wiring accessories, is expected to yield significant operational synergies. The Group has made two acquisitions over the year and is actively reviewing more M&A opportunities. The acquisition aligns with the Group's efforts to expand its product offerings and market reach.

In terms of financial health, Luceco reported a Bank Net Debt of £67.4 million at the end of Q3, with a leverage ratio of 1.8x, which is within the target range. The Group has exercised an option for a £40 million accordion facility, increasing the total bank debt facility to £120 million. This strong balance sheet and cash flow are expected to support further growth investments and M&A activities.

Looking ahead, Luceco's profit expectations are in line with the full-year consensus, with the Group anticipating like-for-like revenue growth in the second half and a total revenue growth exceeding 10% for the year. The Group is optimistic for 2025, buoyed by signs of improving residential RMI sentiment and the normalization of container shipping costs. Moreover, Luceco is gearing up to launch EV Chargers for commercial premises and a Home Energy Management System, which integrates various residential energy solutions.

Chief Executive Officer John Hornby expressed confidence in the Group's diversified portfolio and channels, contributing to a strong trading performance and maintaining full-year profit expectations. He highlighted the recent CMD acquisition and improving market sentiment as positive indicators for the Group's growth trajectory into 2025 and beyond.

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Source: Investing.com