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Avon Protection Reports Order Growth; Cuts FY21 Margin, Revenue Outlook - Quick Facts

Avon Protection Plc. (AVON.L), formerly known as Avon Rubber plc, Friday said Avon said it has continued to see good commercial progress in the second half of fiscal 2021, with order intake in the ten months to July 31 of $221 million. This represents order growth, excluding Team Wendy, of 13 percent from last year.

The order book is $146 million, including Team Wendy, up 21 percent year-on-year.

Further, the provider of life critical personal protection systems said that for fiscal 2021, it now sees a reduction in revenue guidance to between $245 million and $260 million, despite the positive demand backdrop.

Further, Avon Protection said the result of the lower revenue expectations, combined with an adverse mix effect and an overhead base that is fixed in the short term, means that adjusted EBITDA margin guidance is expected to reduce to between 17 percent - 18 percent for the year, before recovering thereafter.

In its trading update for its current financial year, the company said the outlook reflects the impact of delays in the receipt of orders, supply chain disruption and a tight U.S. labour market that has increased significantly through the second half of the financial year.

The COVID-19 related disruption is expected to be temporary in nature.

The company said its Board is confident that the delayed orders will be received over the coming months, but expects supply chain disruption and a tight U.S. labour market to persist into next year.

Due to this, the company reduced fiscal 2022 revenue expectations to $320 million to $340 million, while it maintained current guidance for fiscal 2023.

Paul McDonald, Chief Executive Officer, said, "... These issues will be resolved over the coming months, but as they are affecting both our customers and suppliers simultaneously the situation has significantly limited our operating agility in the short term. We remain as confident as ever about the medium-term prospects of Avon Protection, underpinned by a record order book, a growing and visible contract pipeline and world leading businesses and technologies. We will carry significant momentum into next year, which will also benefit from a strong ramp-up in the Ballistics business, and remain well set for growth in FY22 and beyond."

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