12 February 2015

 

Elektron Technology plc

 

Year end trading update

 

Elektron Technology plc (AIM: EKT, "Elektron" or the "Group"), the global technology group, provides an update on recent trading covering its financial year ending 31 January 2015 and developments in its Checkit business.

 

Group Trading

 

Group revenue from continuing operations for the year amounted to £44.5m (unaudited) (2014: £46.3m), with revenue in the second half of £22.4m (unaudited) slightly ahead of the Board's expectations. Combined with continuing improvements in efficiency, this is likely to result in operating profit (before exceptional charges) in the second half of the year being ahead of the £0.6m reported in the first half - and better than indicated in the most recent trading update on 24 November 2014.

 

In addition, there were no operating or finance related exceptional charges in the second half of the year.

 

Net debt at 31 January 2015 was £2.8m (unaudited) (31 January 2014: £8.0m; 31 July 2014: £4.7m (unaudited); 31 October 2014: £2.7m (unaudited)).

 

Checkit

 

As reported in its 24 November 2014 update, the Group has begun to accelerate investment in key new product development programmes, in particular relating to its Checkit monitoring and process management technology (www.checkit.net), with a number of strategic technical appointments complemented by outsourced development.

 

Checkit will be the primary focus of the Group's investment plans. Investment in Checkit is unlikely to show a positive return for a number of years, however. For that reason, and to ensure the Board can clearly demonstrate the progress made in other parts of the Group, the results of Checkit will in future be shown separately from those for the rest of the business.

 

Given the scale of the opportunity that Checkit can address, the Board intends in the current financial year to devote the majority of the cash flow from the remainder of the business to Checkit.

 

In 2015, the Board expects Checkit to initiate two product launches and to progressively scale up its sales and marketing efforts.

 

The Board is also pleased to note that the Checkit v1 system was recently awarded "Product Excellence Award for Hygiene" by The Caterer magazine - a strong endorsement by a leading industry publication.

 

Outlook

 

Elektron continues to focus on maximising the performance of its existing portfolio of brands in the short term, whilst developing and launching innovative new products for both Checkit and the established brands to enable growth in the medium and longer term.

 

The Group continues to have limited visibility, given that the order book is of approximately six to eight weeks' duration. However, the first two months of the current financial year are expected to see good sales levels.

 

John Wilson, Chief Executive Officer of Elektron, said:

 

"The Group now has a firm foundation, which will allow us to focus on growth. I am optimistic for the future as we invest in key areas of the business that offer strong potential - such as our Checkit monitoring and process management technology."

 

 

Enquiries:

 

Elektron Technology www.elektron-technology.com	+44 (0) 1223 371 000
John Wilson - Chief Executive Officer
Andy Weatherstone - Chief Financial Officer
finnCap (Nominated Adviser, Financial Adviser and Broker)	+44 (0)20 7220 0500
Ed Frisby/Scott Mathieson (Corporate Finance)
Malar Velaigam (Corporate Broking)
Instinctif Partners	+44 (0)20 7457 2020
Adrian Duffield/Kay Larsen

 

 

Notes to Editors

 

Elektron conceives designs and markets innovative engineered products and services for businesses at its technology hub in Cambridge. It has a multi skilled team of engineers and product line specialists focused on the opportunities created by disruptive global trends in the following areas:

 

·         Demand for ubiquitous power and data: Connectivity Solutions

·         Internet of Things, cloud computing and mobile devices: enabling automation and management of a new wave of business processes: Checkit

·         Growth in high precision manufacture: Nano-positioning

·         Healthcare for the ageing population: Ophthalmology

·         Connected customer experiences and service delivery: E-Commerce and E-Service

 

In addition, Elektron owns a portfolio of well-established products and brands which provide customer access and feedback.

 

Elektron Technology is headquartered in Cambridge and its shares are admitted to trading on the AIM market of the London Stock Exchange.

 

Forward looking statements:

 

Statements contained in this release are based on the knowledge and information available to the Company's directors at the date it was prepared and therefore the facts stated and views expressed may change after that date. By their nature, the statements concerning the risks and uncertainties facing the Company in this Statement involve uncertainty since future events and circumstances can cause results and developments to differ materially from those anticipated. To the extent that this Statement contains any statement dealing with any time after the date of its preparation such statement is merely predictive and speculative as it relates to events and circumstances which are yet to occur. The Company undertakes no obligation to update these forward looking statements.