Solid State PLC Trading Update & Notice of Results (2577U)
23 October 2017 - 5:00PM
UK Regulatory
TIDMSOLI
RNS Number : 2577U
Solid State PLC
23 October 2017
Solid State plc
("Solid State", the "Group" or the "Company")
Trading Update &
Notice of Results
Solid State plc (AIM: SOLI), the AIM listed supplier of
specialist industrial/ruggedised computers, electronic components,
advanced antenna products, communications systems and battery power
solutions to the electronics market, announces a trading update for
the six months ended 30 September 2017.
Group revenue for the period has increased by circa 12% to
GBP22.5m (2016: GBP20.09m), reflecting strong organic growth in the
distribution division of close to 20% and a 7% increase in the
manufacturing division reported revenues.
At an individual business unit level, product line margins
within both divisions have been maintained. However, as we have
experienced in previous years, changes in product mix affect
overall Group gross margin. In this period, the combination of the
increased proportion of distribution sales and change in mix of
sales within the manufacturing business has resulted in a Group
gross margin of approximately 28% (2016: 31%).
The investment in and restructuring of the communications
business unit and Leominster operations, as outlined in the Final
Results announcement, is now complete and has positioned the
business for future growth. Despite an improvement in revenues
relative to the comparative period, the lead time to win and
deliver some of the complex antenna programmes has taken longer
than expected, resulting in a performance below management's
expectations. The prospect pipeline remains strong, positioning the
business unit for a stronger 2018/19.
Planned investment to drive long term organic growth and margin
enhancement across the Group increased overheads from the start of
this fiscal year. The benefits of these initiatives are starting to
be realised as evidenced by the organic growth rates achieved in
the distribution division through additional sales resources. Good
progress is being made in implementing the Group's margin
enhancement strategy through additional added value services and
operational efficiencies; the benefits of this activity should be
seen in the next financial year.
As a result of the product mix in the period and increases to
overheads through the investment in growth and margin initiatives,
the Board expects profit before tax to be slightly lower than
current market expectations for the full year.
Looking forward, the Board remains confident that the prospects
for the Group remain strong. The Group has delivered significant
organic growth in the first half, maintained product line margins,
and can report an open order book at 30 September 2017 of GBP18.0m
(2016: GBP14.8m).
Notice of Results:
Interim results for the six months ended 30 September 2017 are
expected to be released on 21 November 2017.
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014.
For further information please contact:
Solid State plc 01527 830 630
Gary Marsh - Chief Executive investor.information@solidstateplc.com
Peter James - Group Finance
Director
WH Ireland (Nominated Adviser
& Joint Broker) 0117 945 3470
Mike Coe / Ed Allsopp (Corporate
Finance)
Jasper Berry / David Kilbourn
(Corporate Broking / Sales)
finnCap (Joint Broker)
Ed Frisby / Kate Bannatyne
(Corporate Finance)
Emily Morris / Rhys Williams
(Corporate Broking / Sales) 020 7220 0500
Walbrook PR (Financial PR) 020 7933 8780
Tom Cooper / Paul Vann 0797 122 1972
tom.cooper@walbrookpr.com
Notes to Editors:
Solid State plc (SOLI) is a leading value added group of
companies providing specialist design-in and manufacturing services
to those acquiring industrial/rugged computing products, battery
power solutions, communications systems, advanced antenna products
and electronic components for use in harsh environments.
Serving niche markets in oil & gas production, medical,
construction, security, military and field maintenance, Solid State
acts as both a distributor to OEMs and bespoke manufacturer of
specialist units to clients with complex requirements.
Headquartered in Redditch, Solid State employs over 200 staff
across five sites. Solid State operates through two main divisions:
Solid State Supplies and Steatite.
Solid State was established in 1971 and admitted to AIM in June
1996.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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