31 July 2006
Press Release 31 July 2006
('Hardide' or the 'Company')
Hardide plc (AIM:HDD), the provider of unique surface engineering technology,
announces the following trading update.
The current financial year ended 30 September 2006 is likely to produce results
below current market expectations. The Company is, however, expecting to report
turnover significantly in excess of last year.
The expected shortage in revenue and increase in loss are attributable to two
• One of Hardide's major customers has recently been reducing inventory and this
has resulted in lower than expected sales. Nonetheless, Hardide remains the
specified supplier to this customer and accordingly the Company expects orders
to resume previous levels once the customer's inventory has stabilised in the
• Hardide has experienced a longer conversion time for customers expressing intent
to purchase the Company's product. This slow-down is mainly attributed to high
productivity at Hardide's major customers and has subsequently led to a
slow-down in field-testing. Importantly, field-testing is still yielding the
historic impressive results with a majority of customers opting to use Hardide's
technology, albeit taking more time to fully incorporate Hardide's coating.
Progress at Hardide's new manufacturing facility in Houston, Texas, is
progressing ahead of expectations with the facility on course to be open for
business on 1 September 2006, a month earlier than previously estimated. The
Company is extremely optimistic about the prospects for this facility and talks
are progressing with a number of potential significant customers.
Owing to anticipated high demand for its product from both new and existing
customers, the Company has taken the opportunity to enlarge the premises in
Bicester, Oxford, to accommodate post finishing and streamlining facilities. To
accommodate these new facilities, Hardide is leasing an additional space of
4,000 sq. ft.
Hardide's recent exhibition at the Farnborough Air Show has produced several
high level enquiries from large multinational corporations and has enhanced the
Company's reputation for the provision of leading surface engineering
technologies. Although in early stages, the Company is confident that this
interest will lead to future orders.
Commenting on the announcement, Jim Murray-Smith, Chief Executive of Hardide,
said: 'Although it is frustrating to miss our targets for the year ended 31
September 2006, I am nonetheless encouraged by current developments at Hardide.
It should be noted that any shortfall in revenues is attributable to minor
delays in the field-testing of our products by certain customers and the
decision by one of our major customers to not hold inventory at historic levels.
Neither of these factors will affect Hardide's profitably on an on-going basis
and the Company's future still looks very promising.
'I am pleased to report that the manufacturing facility in Houston is
progressing ahead of schedule and recent discussion with potential customers
further confirms our belief that demand for our product in this region will be
particularly strong. The Company also received a good reception at the
Farnborough air show and I am confident that this not only boosted our presence
within the industry but will also ultimately lead to further orders from the
'I look forward to updating shareholders on progress in our preliminary results
for the year to 30 September 2006 in December.'
- Ends -
For further information:
Jim Murray Smith, Chief Executive Tel: +44 (0) 1869 353 830
Daniel Stewart & Company plc
Paul Shackleton, Corporate Finance Tel: +44 (0) 207 776 6550
Chris Lane / Laura Riascos de Castro Tel: +44 (0) 20 7398 7700
This information is provided by RNS
The company news service from the London Stock Exchange