LONDON (ShareCast) - (Sharecast News) - Flowtech Fluidpower reported a significantly widened operating loss for 2024 on Wednesday, as market conditions remained challenging, but highlighted improvements in gross margin, operational efficiency, and sales pipeline quality as it positions for future growth.
The AIM-traded firm said revenue declined to £107.3m from £112.1m in 2023, as it posted an operating loss of £25.2m, compared with a loss of £10.4m the prior year, reflecting the impact of one-off items and restructuring costs.

However, its gross profit margin improved by 142 basis points to 38.2%, driven by enhanced commercial discipline, procurement savings and leaner inventory management.

Underlying EBITDA fell to £5.9m from £9.4m, while underlying operating profit declined to £2.7m from £6m.

Net cash from operating activities rose slightly to £8.7m, and net debt increased marginally to £15.1m.

No final dividend was declared, compared to 2.2p in 2023.

Operational highlights included the successful integration of Thorite, the UK's largest independent pneumatic distributor, and the continued shift towards digital channels, with over 70% of product distribution now via online orders.

The company also noted strong customer retention, a growing order book, and rising own-brand product sales.

Post year-end, Flowtech acquired Allswage out of liquidation for £50,000, adding £0.4m in inventory and additional servicing capacity.

Despite ongoing global trade uncertainty, trading in the first quarter of 2025 was in line with expectations.

Flowtech said it was focussed on higher-growth sectors including defence, infrastructure, and flood defence, adding that it would launch a new e-commerce platform in the second quarter to support further sales growth.

"We have made strong progress to implement our strategic plan with further operational improvements delivering enhancements to gross margins, working capital optimisation, service levels, and operational efficiencies," said chief executive officer Mike England.

"Group rebranding and restructuring are complete, and the successful integration and financial contribution of Thorite is well ahead of our expectations."

England said that with much of the business transformation concluded, the company had a "firm, stable and scalable platform" from which to deliver profitable growth into 2025 and beyond.

"We are well on track with the development of our new digital platform to be launched to market in the first half of 2025 and there is confidence that the broader strategy and actions taken to grow our addressable market and improve operational efficiency within the business will drive strong returns and improved shareholder value."

At 1248 BST, shares in Flowtech Fluidpower were up 2.04% at 50p.

Reporting by Josh White for Sharecast.com.

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