Bits and Splits - stock.adobe.co
The worst days of the pandemic hit the audio-visual (AV) market hard but as the world reopened after the lockdowns, that sector was one of the first to see a bounce back in customer spending.
Midwich has shared what those recovering market conditions have meant for its business to investors, with a trading update for its financial year ended 31 December.
The distributor, which specialises in AV, had a strong finish to its fiscal year and is now expecting to report revenues 20% higher than previously expected, around £850m. Adjusted pre-tax profit was also expected to be solid and come in at no less than £31.5m, also ahead of previous expectations.
Stephen Fenby, Midwich Group managing director, said 2021 had been a successful year for the business and it had managed to grow despite ongoing challenges in the market.
“Coming into the year, our ambitious goal was to return the group’s profitability back to pre-Covid-19 levels,” he said. “We achieved this, finishing the year with the highest revenues and net profit in the group’s history. I would like to thank our team for this fantastic result.”
Fenby added that Midwich’s acquisitions had also contributed to the bottom line and made a difference over the last year. “Since joining the group in 2021, NMK, eLink and Intro 2020 have all performed well, and we look forward to working with our new colleagues at DVS, who joined the group in early January,” he said.
That deal, struck earlier this month, saw Midwich take a majority stake in Cooper Projects, parent company of distributor and video security expert DVS, as it looked to expand its knowledge and customer base in that area. Cardiff-based DVS handles CTTV and associated video-recording technologies and has a strong relationship with vendor HikVision. The firm operates in numerous verticals, including corporate, retail and residential markets.
Looking ahead, Fenby hinted that there was more to come on the acquisition front as the channel player looks to enhance its market position further.
“In 2022, the group’s focus will be on maintaining a strong growth trajectory while supporting customers through ongoing widespread product shortages, exploring cross-selling opportunities in the current portfolio and also evaluating the healthy pipeline of potential acquisitions,” he said.
This is a different narrative from last March, when Midwich shared its full-year numbers covering 2020 and the distributor will hope it can keep investors cheering when it releases detailed full-year results later this quarter.