In a Trading Update for the year ended December 31st 2021 Mpac Group confirms strong performance for the year, with revenue, adjusted PBT and the year-end cash position in line with market estimates.
Strong H2 order intake led to a year-end closing order book of £77.0m, an impressive increase of 39%YoY, which continues a rising trend.
The resilience of FY21 performance reflects the impact of Mpac’s strategy in two respects. First, its ‘outward-facing’ market positioning. Examples include entry into the US beverage packaging market via the acquisition of Switchback, and the more recent addition of the clean energy vertical via the contract with FREYR. This diversification should eventually overtake the exposure to the pharma sector. Secondly, notwithstanding the underlying efforts and commitment required to offset the impact of Covid on operations, the One Mpac initiative continues to underpin performance. These are proactive initiatives which give us confidence that Mpac can extract further efficiencies and enhance growth as global economies gradually normalise. In its update Mpac also emphasises its ongoing commitment to develop OEM-based revenue streams, along with higher-margins via its Digital Services offering (c.23% of FY21(E) revenue).
We maintain our fair value for Mpac shares of 660p.
