Zotefoams unveils bullish growth targets after record year

Zotefoams reported an operating profit before exceptional items of £18.1m for 2024, up 20% over the year, with revenues rising 16% to £147.8m.

The company said it has been working on product mix "enrichment", and saw high-performance product sales surpass those of Polyolefin Foams for the first time in 2024.

Cash generated from operations surged 151% to £30.4m, while net debt excluding leases shrank by 20% to £24.1m.

The company declared a final dividend of 5.1p per share, up 4% on the previous year.

As part of its new, so-called "Expanding Beyond the Core" strategy, Zotefoams said it is targeting organic growth of 7% CAGR over the next four years to deliver revenue in excess of £200m by 2029.

"We have set out, and are executing, a refreshed, focused strategy, prioritising innovation and profitable growth. Our market realignment is progressing well as we transition from a product-centric to an industry-led approach," said chief executive Ronan Cox.

Longer term, the company is hoping to grow revenues to over £300m and operating profits to over £60m "with the opportunity to accelerate progress through inorganic growth".

Cox did warn that, while polymer and energy input prices were currently stable, the impact of trade tariffs could have an impact. However, he said: "While we remain mindful of the uncertain economic backdrop and the evolving trade landscape, we are confident in our ability to deliver another year of good progress for Zotefoams."

Shares were up 3% at 269.7p by 1025 GMT.