GYG swings to loss amid market 'turbulence'

Global Yachting Group swung to an annual loss as painting and coatings revenues dipped due to "continued turbulence" in the refit market.

The superyacht painting, supply and maintenance company reported a loss before tax of €4.6m for 2018, down from a profit before tax of €0.5m the year before, as revenue dipped 28% to €45.0m after a 34% turnover decrease in the Coating division.

This decrease reflected the continued turbulence in the refit market and the lower than expected new build revenue, according to GYG, though the Supply division delivered a 7% increase in revenue to €9.5m despite a "challenging" start of the year as trading patterns were slightly lower than normal across the entire sector.

Cash and cash equivalents stood at €5.1m at the end of the year, down from €6.2m compared to the year earlier.

Remy Millott, chief executive of GYG said: "Despite 2018 being a very difficult year for the group and the wider market, we have made significant progress internally through Q4 2018 following our focus on improving the business and the way in which we operate. The changes we have put in place have provided greater visibility on future revenues, gross margins, sales and pipeline."

Millott added that the newly implemented systems are intended to ensure management can address any important issues earlier, enabling the team to spend more time with key clients while focusing on winning business from both new and existing customers.

The AIM traded company said business in the current year has been "encouraging" as new build and refit activity levels have increased, though the board are remaining cautious until there is firm evidence of an increase in volume of orders to continue into the second and third quarters.

The business is evaluating potential acquisition targets consistent with its strategy of developing its position within the superyacht service and supply sector, but remains focused on growing its market share in core sectors.

"The strong order book position at this stage in the year and the exciting opportunites that we are being presented with, gives the board confidence for the future where we are focused on delivering long term shareholder value," said Millott.

GYG's shares were up 0.83% at 60.50p at 0845 BST.