Filtronic PLC Trading Update (1369L)
September 29 2016 - 2:00AM
UK Regulatory
TIDMFTC
RNS Number : 1369L
Filtronic PLC
29 September 2016
Filtronic plc
("the Company")
Trading Update
Filtronic plc (AIM: FTC), the designer and manufacturer of
microwave electronics products for the wireless telecoms
infrastructure market and adjacent markets, is pleased to provide
the following update for the three months ended 31(st) August 2016
at the Annual General Meeting ("AGM") being held today.
The Board is pleased to announce that the Company has traded
strongly in the first quarter. Revenues were GBP11.7m (2015:
GBP2.2m) resulting in the Group returning to profitability with an
operating profit of GBP1.0m (2015: GBP2.0m operating loss). The net
cash balance at the quarter end was GBP0.9m. These results
demonstrate significant improvement when compared with those
achieved in FY2016 where the results for the full year were sales
of GBP13.6m, an operating loss of GBP7.0m and net debt of GBP0.4m
at the period end.
The improved financial performance was primarily driven by sales
of our new ultra-wide band integrated antennas to our lead customer
following the successful production ramp in the final quarter of
FY2016, together with improving demand for our mmWave backhaul
products and base station filters.
Whilst the Board is pleased with the progress made and remains
confident that the long-term prospects for the business are good,
it is mindful that these results are currently being driven
primarily by demand from one customer for a single product type.
Roll-out programs for wireless infrastructure projects are
naturally very lumpy and it is, therefore, to be expected that
until these new antenna products gain greater traction in the
broader market over the course of the next year, we will continue
to experience short-term variations in sales performance for at
least the balance of FY2017. It should also be noted that
seasonality in installing infrastructure in the telecoms industry
is skewed toward the spring and summer months and therefore we
expect sales of these products to be lower in the 2(nd) and 3(rd)
quarters of the financial year than for the 1(st) Quarter.
To address our customer concentration, Filtronic Wireless has
recently recruited additional experienced senior sales executives
in Europe and North America to target opportunities with mobile
network operators. Initial engagement with potential clients has
resulted in favourable feedback. However, it is likely that
building business with new clients will take time and we do not
anticipate appreciable sales to new customers from these new
selling initiatives until FY2018.
Filtronic Wireless continues to build and develop its product
portfolio to address opportunities available in the market and will
be releasing further antenna variants that support the new
frequencies being released in the US (600MHz) and Europe (1400MHz).
These developments are incremental steps based on our existing
platform with prototypes expected to become available to evaluate
in Q2 of FY2017 and available to the market in H2.
Filtronic Broadband meanwhile continues to see steady growth in
sales of Orpheus, its latest generation E-band transceiver, with
demand at our lead customer continuing to ramp. A key objective for
Filtronic Broadband has been to diversify its customer base and
product offering. To this end we have been developing a number of
potential new client opportunities for Orpheus, both in
telecommunications backhaul and adjacent markets. In addition, we
are starting to gain traction in the design and manufacture of
filter products and specialist high-frequency assembly and test
services which are both supplied to defence & aerospace
customers. These opportunities are at varying stages of development
and whilst we do not expect all prospects to be converted, the
Board is encouraged by the level of interest being generated.
Enquiries:
Filtronic plc Tel. 0113 220 0000
Rob Smith (CEO)
Maura Moynihan (Company Secretary) Tel. 01274 535 619
Panmure Gordon (UK) Limited Tel. 020 7886 2500
Dominic Morley / Alina Vaskina (Corporate
Finance)
Erik Anderson / Tom Salvesen (Corporate
Broking)
Walbrook PR Limited Tel. 020 7933 8780 or filtronic@walbrookpr.com
Paul Cornelius Mob. 07866 394 707
Helen Cresswell Mob. 07841 917 679
Notes:
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) No 596/2014.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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