Essentra trading in line, announces acquisition of Boteco

(Sharecast News) - Essentra said in an update on Wednesday that trading in the first four months of 2026 was in line with expectations, as it announced the acquisition of Italian mechanical components maker Boteco for an initial €7.4m. The London-listed components manufacturer said group revenue rose 7.2% on a constant currency, trading day adjusted basis in the four months to 2 May.

Like-for-like sales increased 5.2%, reflecting both pricing and volume, while the acquisition of Device Technologies, completed in December, contributed 2.0% of inorganic growth.

Essentra said order intake momentum had been maintained and was ahead of sales, supported by disciplined pricing and a continued focus on faster-growth end markets.

Regional performance was mixed.

EMEA delivered high-single-digit like-for-like growth, driven by volume and pricing, with modest early signs of recovery in Western Europe and continued strength in Turkey.

The Americas recorded low-single-digit growth, mainly reflecting pricing actions, while APAC was broadly flat.

The company said faster-growth markets including digital infrastructure and energy transformation continued to offset modest softness in traditional core markets such as automotive.

Essentra said its direct exposure to the Middle East was limited and there had been no material direct impact on trading in the period.

It said its localised supply chains and regional manufacturing footprint provided resilience, while a further round of pricing actions was being implemented in the second quarter to help mitigate inflationary pressures.

The board said full-year 2026 expectations were unchanged.

In a separate announcement, Essentra said it had agreed to acquire Boteco, a family-owned business based in Vicenza with more than 50 years of operational history and over 900 active customers worldwide.

Boteco designs and manufactures machine components including handles, plastic and metal knobs, feet and hinges.

The acquisition comprised an initial cash payment of €7.4m, funded from Essentra's existing debt facilities, plus deferred contingent cash consideration of up to €2.5m on a cash-free, debt-free basis.

Boteco generated revenue of about €7.0m in the year ended 31 December, with the initial consideration representing a multiple of 6.5 times EBITDA.

Essentra said it expected a 15% return on invested capital in the third full year of ownership.

The acquisition was expected to complete in the first half, subject to a small number of pre-close conditions.

Essentra said Boteco would enhance its product expertise, extend its European manufacturing footprint and provide cross-selling opportunities across its global customer base.

The group said net debt leverage at the half year was expected to be around 1.6 times following the acquisition.

Boteco was expected to be accretive to group margins and adjusted earnings per share in the first full year after completion.

Chief executive Scott Fawcett said Boteco was a "high-quality business" that complemented Essentra's model and strengthened its position in machine and automation end markets.

"This acquisition builds on the momentum of our Device Technologies acquisition announced in December 2025 and further demonstrates Essentra's growth strategy, combining organic investment with disciplined, value-accretive M&A," he said.

At 0909 BST, shares in Essentra were up 2.32% at 83.9p.

Reporting by Josh White for Sharecast.com.

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