Exova Group plc acquires BM TRADA

Organic growth on track complemented by good progress with acquisitions.  

Exova Group plc ("Exova"), a leading international provider of technically demanding testing and advisory services, today releases a Trading Update for the period since 31 December 2014 to date. Where stated, financial results are for the period from 1 January to 30 April 2015 ("the period"). All comparative comments in this statement reflect the comparisons with the corresponding period during 2014.

Group performance

· Total revenue growth of 4.7% at constant currency including acquisitions and net of disposals:

o Organic revenue growth of 3.4%

o Growth from acquisitions of 2.3%

o Impact of disposals of (1.0)%

· Total revenue at actual exchange rates grew by 3.8%

· Acquisition of BM TRADA Group Limited extends our service offering and global reach

· Outlook for our existing businesses in 2015 remains unchanged and we will now exceed acquisitions guidance

Regional performance

In Europe, we have seen good organic growth in our Aerospace, Health Sciences and Product clusters. As anticipated, our Aerospace cluster has returned to growth following the customer delays we experienced in 2014 and our Health Sciences business is continuing to benefit from contracts won in 2014 and a generally positive trading environment. As expected, the impact of low oil prices has led to some contraction in our Oil & Gas and Industrials cluster, however demand for our long cycle, capex-driven testing services remains healthy

Organic revenues in the Americas were broadly flat as we saw an expected return to growth in Aerospace, a trend we believe will continue to improve during the year. We delivered modest growth in Oil & Gas and Industrials as a result of sustained demand for our long cycle, capex-driven testing services in the US and a slightly better than expected performance in Western Canada. We experienced a modest contraction in Health Sciences while levels of activity in the Product cluster remained lower.

In Rest of World, we have seen strong growth as a result of good contract wins in all clusters. The outlook for the region remains positive as we continue to see a good pipeline of future opportunities.

Acquisitions

On 13 May 2015 we completed the acquisition of BM TRADA Group Limited ("BM TRADA") for a consideration of approximately £22 million including the assumption of pension liabilities and subject to normal post-closing adjustments. BM TRADA is a provider of certification and building products testing services employing 340 people across 16 countries with annual turnover in excess of £20 million and pro-forma EBITA margin of about 10%. This acquisition provides Exova with a new platform for growth in systems certification. It also extends our global reach into 8 new countries while expanding our range of building products testing and certification services. BM TRADA will deliver revenues in all three of our geographic regions and will become part of our Product cluster which will be renamed Product and Certification.