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Mpac Group – FY22 ‘in line with expectations and encouraging outlook’. Is it?

Packaging and automation group Mpac (MPAC) has issued a “full year trading update” headlined “FY22 trading performance in line with market expectations and encouraging outlook for FY23”. However, I previously wrote on the group in July including noting profit “significantly below” expectations. Hmmm!

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#MPAC – expects FY “in line with market expectations”, order book down but argues “encouraging outlook”

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Mpac – from “continue to be confident” to profit “significantly below” expectations in little over two months!

Packaging and automation solutions group Mpac (MPAC) has issued a trading update commencing that it “has continued to make progress during the first half of the financial year despite a challenging trading environment, ending the period with a strong order book, ahead of the previous year, and with a very encouraging prospects pipeline. The group expects to report revenue that is ahead of last year and in line with its expectations in respect of the six months ended 30 June 2022”. Sounds good, so what of a current 260p share price...down over 30% on the day?!

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#MPAC – “significantly below” profit warning noting extended lead times and cost inflationary pressures

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#MPAC – H1 adj. EPS recovered to -14% v. H119, no dividend

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#MPAC – H1 “continued momentum”, “comfortable with current full year market expectations”

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#MPAC – expects 2020 adj. PBT “above market expectations”, “trading continues to be resilient”

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#MPAC – “partially mitigated” but “impact on the timing of new original equipment orders, project execution and on-site service revenues”

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#MPAC – expects 2019 ahead of previously upgraded expectations, “improved outlook for 2020”

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#MPAC – H1 sees FY now anticipated to “be above current market expectations”. Medium-term outlook “less certain”