AESSEAL reports 47% sales and 78% EBITDA growth over a 2
20 June 2012
Engineering Ltd, trading as the AESSEAL Group, a
Rotherham based specialist designer and manufacturer of
mechanical seals, reports continued market-leading
performance in its annual results to 31 December 2011.
AESSEAL is a specialist in the design and manufacture of
mechanical seals, engineered seal support systems and
related products for a wide range of applications in
diverse industry sectors. AESSEAL is already the fourth
largest manufacturer of its kind worldwide, and is on-track
for grander ambitions as it expects to record its 30th year
of continued sales and profit growth.
2011 Financial Highlights
Sales of £123.9m, up 19.5%
EBITDA of £22.8m, up 22.9%
Operating profit rose to £18.2m, 14.7% of total sales, up
from 13.2% in 2010
Group net assets were £54.7m, up 22%
Today, 90% of sales are from outside of the UK, with
sales to North America and emerging markets contributing
strongly to sales growth over the period
47% sales growth and 78% EBITDA growth over the last two
A Compound Annual Growth Rate (CAGR) of 20% over 29years
In spite of continued difficult trading conditions and
particular uncertainty in Europe, AESSEAL has reported
another year of strong results for 2011 with sales and
profits rising by 19.5% and 23% respectively. This brings
the headline growth rate since 2009 to 47% in sales and 78%
During 2011 strong progress was made against AESSEAL Group
strategy to differentiate the company through the provision
of exceptional customer service and an outstanding range of
engineered technology products, with significant investment
in a number of areas.
Specifically, AESSEAL invested in stock, which rose £4m
year on year. This was done to provide faster delivery to
more customers and to support AES's world-class delivery
promise. Furthermore, AES employment levels rose by 5%
overall to 1331 during 2011, with an increase of 25%in
direct customer facing employees. This is part of the
company's strong value proposition, as this hard work
allows the company to act as free seal reliability
consultants to the company's customers. Product
development included a greatly extended API product suite,
offering a full range of seals and systems for hydrocarbon
applications and the development of dry gas seal technology
for compressors, providing a 'credible alternative' to the
more dominant suppliers in this sector. M&A also
underpinned the expansion of AES's product offering with
AESPUMP's acquisition of Absolute Vacuum in the UK and two
key acquisitions within the core US market.
These results are particularly encouraging for the UK amid
current political rhetoric about the need for UK-based SMEs
to increase exports. Lord Green, Minister for Trade and
Investment wants to increase the number of UK firms trading
overseas from 20 percent to 25 percent, which would add an
estimated £30 billion to the UK economy. This is part of a
larger plan by the Minister to double UK exports to £1
trillion by 2020.
With such enterprising targets for export, the AESSEAL
group is a strong model to emulate: a full 90% of the
AESSEAL Group's sales came from outside of its domestic
market in 2011, and AESSEAL was recently presented with the
2011 International Trade Company of the Year Award in a
ceremony at the House of Lords. Other high profile recent
awards include the company's 12th Queen's Award, and the
IMechE Manufacturing Excellence awards as both the Overall
Winner and Customer Service winner.
Long term targeting of the strategically important oil and
gas sector also paid dividends for the company,
subsequently contributing ~25% of the group's sales growth,
or up 40% year on year.
The AESSEAL Group's founder and Managing Director, Chris J.
Rea, OBE commented: "Whilst the UK economy hovered on the
edge of recession for much of 2011, at AESSEAL we have
managed to further strengthen our global sales. This is
through continued investment in our customer value
proposition. We have made significant product technology
and customer service infrastructure investments over the
last decade, and I believe we are seeing the benefits.
I also believe that more businesses need to operate a
culture of empowerment - particularly within international
markets. People need to take ownership of the results,
supported by competent management and solid processes from
the central organisation. I think too many international
businesses either exercise too much or too little control.
At AESSEAL we place a huge amount of importance on
empowerment, but with high standards and robust processes."
Ken Beaty, Partner at 3i, a minority investor in AES since
1996, added "It is encouraging to see an example of a UK
manufacturing business bucking the trend to succeed
internationally in today's challenged economy. This is a
result of an outstanding management team, a leading market
position and continued focus on quality and service which
is reflected in AES's consistent 20% CAGR growth."
AESSEAL® is one of the world's leading specialists in the
design and manufacture of mechanical seals and support
systems. The AESSEAL promise to customers is simple: they
aim to give such exceptional service that they need never
seek another source of supply.
AESSEAL customer service and quality has seen the company
show strong growth year on year since it was established in
1979. Today, AESSEAL employs a global network of sales
engineers and technical support specialists.
AESSEAL has won several accolades in recognition of the
company's success during 2011: Its 12th Queens Award to
date - Queens Award for Enterprise - International Trade,
The Institute of Mechanical Engineers Award for
Manufacturing Excellence and Customer Focus and lastly the
International Trade Company of the Year Award.