Avon delivers significant growth as efficiency programme progresses

Melksham, UK – Avon Technologies has reported a strong growth in revenue, operating margin and efficiency in the fiscal year 2024, which ended 30 Sept.

Annual adjusted earnings (adjusted EBITDA) increased 21.6% year-on-year to $43.4 million (€41 million), on 12.8% higher sales of $272 million, Avon reported 19 Nov.

Orders received grew 40.9% to $364 million and closing orderbook was up 66% year-on-year at $225 million, said the UK manufacturer of protection gears.

The group linked the gains to its transformation ‘Star strategy’ which was launched in 2022.

The strategy provided “stronger financial performance, improving operating metrics and a fast-growing order book,” said CEO Jos Sclater.

The streamlining, said the Avon leader, is currently in progress at all factories, with the group potentially on track to achieve its medium-term targets a year earlier by end of 2026.

Avon also expect its transformation programme to be largely complete by 2026, leading to a “significant decrease in transformation cash costs.”

According to Avon the rationalisation plan has so far included the consolidation of helmet manufacturing sites in the US. 

Furthermore, the group said it had identified additional improvement opportunities which could be ‘self-funded through previous improvements.’

Avon said the programme had helped improve productivity 21% compared to 2023, with a 54% year-on-year reduction in scraps across all factories.

Explaining the process, Avon said all its sites had a long history of batch manufacturing and that its previous structure on manufacturing floors was based around equipment type.

“We needed to break up these functional silos and move to a structure based around value-adding activities,” said the group.

Avon has transitioned most of its department of defense helmet lines, commercial helmet lines, and mask manufacturing from traditional batch production to flow manufacturing.

The shift includes changes to the manufacturing processes at Avon’s US facilities in Salem, Massachusetts, and Cleveland, Ohio, which has improved inventory turns, quality, lead times, and productivity.

Avon’s UK site in Melksham has also started a transformation to move from batch to flow manufacturing and has reduced footprint by 25% since the beginning of 2024 fiscal year.

“We have reorganised every major factory into value streams and every line now has visible metrics showing progress by the hour to reduce inefficiencies and cut down on waste,” Avon explained.

In terms of footprint optimisation, Avon said its largest project included the consolidation of its helmet manufacturing sites.

This included moving Integrated Head Protection System (IHPS) moulding to Salem, and IHPS finishing to Cleveland.

As a result, the group closed its facility in Irvine, California.

Avon has also introduced the production of “advanced combat helmet”, now having a run rate of over 60,000 helmets a year.