LUXFER: Management report and analysis of the financial situation and the results of operations (form 10-Q)


Information regarding forward-looking statements
This Interim Report on Form 10-Q contains certain statements, statistics and
projections that are, or may be, forward-looking. These forward-looking
statements are subject to known and unknown risks, uncertainties, assumptions
and other factors that could cause our actual results of operations, financial
condition, liquidity, performance, prospects, opportunities, achievements or
industry results, as well as those of the markets we serve or intend to serve,
to differ materially from those expressed in, or suggested by, these
forward-looking statements. The accuracy and completeness of all such
statements, including, without limitation, statements regarding our future
financial position, strategy, plans and objectives for the management of future
operations, is not warranted or guaranteed. These statements typically contain
words such as "believes," "intends," "expects," "anticipates," "estimates,"
"may," "will," "should" and words of similar import. By their nature,
forward-looking statements involve risk and uncertainty because they relate to
events and depend on circumstances that will occur in the future. We undertake
no obligation to update any forward-looking statements, whether as a result of
new information, future events or otherwise. Although we believe that the
expectations reflected in such statements are reasonable, no assurance can be
given that such expectations will prove to be correct. There are a number of
factors that could cause actual results and developments to differ materially
from those expressed or implied by such forward-looking statements. These
factors include, but are not limited to, factors identified in "Business," "Risk
factors," and "Management's Discussion and Analysis of Financial Condition and
Results of Operations," or elsewhere in this Interim Report, as well as:
•general economic conditions, or conditions affecting demand for the services
offered by us in the markets in which we operate, both domestically and
internationally, being less favorable than expected;
•worldwide economic and business conditions and conditions in the industries in
which we operate;
•ongoing impact of COVID-19 and future pandemics;
•fluctuations in the cost of raw materials and utilities;
•availability of essential inputs, including but not limited to, raw materials,
transport, energy and labor;
•currency fluctuations and other financial risks;
•our ability to protect our intellectual property;
•the amount of indebtedness we have incurred and may incur, and the obligations
to service such indebtedness and to comply with the covenants contained therein;
•relationships with our customers and suppliers;
•increased competition from other companies in the industries in which we
operate;
•changing technology;
•our ability to execute and integrate new acquisitions;
•claims for personal injury, death or property damage arising from the use of
products produced by us;
•the occurrence of accidents or other interruptions to our production processes;
•changes in our business strategy or development plans, and our expected level
of capital expenditure;
•our ability to attract and retain qualified personnel;
•restrictions on the ability of Luxfer Holdings PLC to receive dividends or
loans from certain of its subsidiaries;
•regulatory, environmental, legislative and judicial developments; and
•our intention to pay dividends.
Please read the sections "Business" and "Risk factors" included within the 2020
Annual Report on Form 10-K and "Management's Discussion and Analysis of
Financial Condition and Results of Operations," and "Risk factors" of this
Interim Report on Form 10-Q for a more complete discussion of the factors that
could affect our performance and the industries in which we operate, as well as
those discussed in other documents we file or furnish with the SEC.
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About Luxfer Luxfer is a global manufacturer of high-tech industrial materials, focused on creating value using its wide range of technical know-how and proprietary technologies. Luxfer’s high performance products are used in defense and emergency response, healthcare, transportation and general industrial environments. For more information, visit www.luxfer.com. Key Trends and Uncertainties Regarding Our Existing Businesses Impact of COVID-19 on Operations

The global COVID-19 outbreak, characterized by heightened business uncertainty and widespread market weakness, negatively impacted our financial results in 2020, affecting demand in most of our end markets. We took various steps in 2020 to help mitigate the financial impact, including implementing additional cost savings measures, reducing our capital spending, initiating restructuring measures and proactively managing our fund. rolling. Activity in most of the end markets we serve has improved throughout 2021 since the start of the year, although like-for-like sales are still around 10% below the prior level. pandemic of 2019. The recovery in demand has had trade impacts, including increased material cost inflation on key inputs (including magnesium, aluminum and carbon fiber), labor availability and increases in energy and transportation costs. Currently, we expect the impact of material and energy cost inflation and labor and transportation constraints to continue at least until the fourth quarter of 2021, with uncertainty around outlook for 2022.

Luxfer’s The top priority during this global pandemic has been the health and well-being of our employees, customers, shareholders and the communities in which we operate. The Company continues to closely monitor the COVID-19 situation, including subsequent supply constraints, while simultaneously executing business continuity plans. These business continuity plans include, but are not limited to, (i) retooling operations to maintain social distancing and maximize employee safety; (ii) increasing resources and efforts to manage supply constraints in order to meet demand from the most impactful parts of our business; (iii) extend flexible working arrangements and policies, to the extent possible, to maximize employee safety; and (iv) provide regular updates to our shareholders, employees, customers and suppliers in a transparent and timely manner.


Operating objectives and trends
In 2021, we expect the following operating objectives and trends to impact our
business:
•Continuing proactive response to the COVID-19 pandemic, including the health
and well-being actions highlighted above, in addition to initiatives to
stimulate demand for products, ensure continuity of supply and focus on cost
saving programs;
•Divestiture of non-strategic aluminum businesses (identified as discontinued
operations) in the Gas Cylinders segment;
•Refocus on productivity acceleration and growth recovery post COVID-19 as we
capitalize on lean manufacturing initiatives and pursue faster product
innovation;
•Continued focus on developing global talent and implementing a high-performance
culture; and
•Continued focus on improved operating cash generation with lower restructuring
activity and maintaining strong working capital performance.
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