17 December 2013

Elektron Technology plc

Third quarter trading update

Elektron Technology plc (AIM: EKT, "Elektron" or the "Group"), the global technology group, provides an update on recent trading.

As announced at the half year results in September 2013, operations have stabilised and as expected in the second half of the year, the sales backlog is improving. Selective price increases and reduced operating expenses are also being implemented.

The Group's performance is benefitting from the actions taken earlier in the year and the recovery is proceeding according to expectations, with the Group returning to an operating profit before non-recurring or special items for the third financial quarter (H1 £0.1m loss). The unaudited loss before tax (after non-recurring or special items and finance costs) for the third quarter was materially smaller than the losses incurred in each of the first and second quarters of the current financial year (H1: £2.4m loss).

At the end of November 2013, year to date sales (unaudited) on continuing business represented 95% of prior year continuing sales for the same period. This compares to 92% as at the end of July 2013. Group order cover at 30 November 2013 of £10.1m was 133% of the prior year's £7.6m.

In view of the restructuring programme costs incurred in the first four months of the second half of the financial year, the expectation for working capital management for the remaining two months and cognisant that the Group's bank continues to be supportive of the business, net debt at 31 January 2014 will be higher than that reported at 31 July 2013 (£5.8m).

As part of the rationalisation of its portfolio, on 4 November 2013, Elektron announced that it had completed the sales of its Chinese subsidiaries, Elektron Components (Shenzhen) Limited and two Sifam branded product lines (Meters and Control Knobs) for a total cash consideration of approximately GBP0.3m.

The Group continues to place emphasis on both further operational improvements and its new product development programme with several developments expected in the next financial year in its Bulgin, Checkit, Queensgate and Ophthalmic brands.

 John Wilson, Chief Executive Officer of Elektron said:

"The actions taken to address our operational challenges earlier in the year are already paying off, and we are pleased to have returned to an adjusted operating profit level for the third quarter of this year.

"We continue to focus on further operational improvements and product developments to meet the encouraging customer demand we are seeing."

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Notes to Editors

Elektron Technology is a global designer and manufacturer of precision engineered products which enable two of the most important technology areas of the always-on, networked economy: Connectivity and Instrumentation, Monitoring & Control ('IMC'). 

The Group has a broad portfolio of products that are recognised leaders in their markets, playing a critical role in many industries from underwater construction to food preparation, semiconductor manufacture to emergency vehicle systems. The Group's products are sold worldwide to over 7,000 customers, around 100,000 end-users, and used in all seven continents and in space.

Elektron Technology is headquartered in Cambridge and traded on the AIM market of the London Stock Exchange.