INVESTORS : Post

Straight plc (AIM: STT), the environmental products and services group, is today providing an update on trading for the year ended 31 December 2009 and prospects for 2010, ahead of its preliminary results announcement on 23 March 2010.

Group turnover for the year ended 31 December 2009 was 11% higher than in 2008 at over £28m. Profit before tax for 2009 is expected to be in line with market expectations.

The Group's Trade business saw continued growth with significant revenue increases being enjoyed in both its core municipal and non-municipal divisions. These increases were at healthy margins as a consequence of the Group's ability to respond quickly to the market by the appropriate investment in new product innovation.

Revenues from non-municipal customers were driven by increased garden and hardware sales to both UK and overseas customers. These were buoyed by the success of the acquisition of Harcostar in January and also, towards the end of the year, by the commencement of outsourced manufacturing in the United States to service North American customers, following on from the success of this model in Australia. Around 4% of revenues were generated from overseas customers in 2009. This figure is expected to increase substantially in 2010.

The performance of the Group's Retail business has been transformed since 2008. As the business has focused on strategically important clients and products, as well as greatly reducing delivery costs, it has largely eradicated its operating losses. The foundation has now been laid, on which the large increases in sales, expected in 2010, can now be profitably delivered. In addition, WRAP's withdrawal from the English home compost bin market in October, promptly led to increased revenues for the Group during the fourth quarter and this is expected to continue into 2010.

The rapid cash payback on the substantial investment in food waste containers made by the Group in 2008 has facilitated a second successive year of extensive capital investment in new products for both the Group's municipal and non-municipal customers. In spite of such high investment, cash balances at the end of 2009 remained at £1.6m (2008: £1.6m).

The final quarter of 2009 saw the Group take orders at unprecedented levels, leaving it in a strong position for 2010.