TT Electronics PLC

Trading Statement

RNS Number : 5815N
TT Electronics PLC
10 May 2018
 

 

 

 10 May 2018

 

TT Electronics plc

 

Trading Update

 

TT Electronics ("TT" or the "Group"), a global provider of engineered electronics for performance critical applications, today publishes this trading update for the four months to the end of April 2018.

 

Trading for the Group has been positive with continuing revenue and order momentum in the period as expected. Group revenue is up 4% on an organic¹ basis compared to the prior year. Order intake has been good, and the order book across all three divisions continues to be strongly ahead of the prior year. The order book strength is in part due to customers continuing to place orders further ahead than at this time last year as a result of on-going industry-wide component shortages, and provides increasing confidence of delivering growth in the year.

 

Performance across the Group has been encouraging with good growth dynamics translating into margin progression in the Sensors and Specialist Components and Global Manufacturing Solutions divisions. As a result of continued strong demand in the Power Electronics division, additional investment has been made to meet customer schedules, and to build capacity to deliver anticipated future growth. These costs, together with the absence of last year's high margin one-off sales, will impact the Power Electronics divisional margin in the first half, with the division's margin expected to normalise for the full year. Group margin progression has been positive.

 

On 18 April, we completed the acquisition of Stadium Group plc for an enterprise value of £59.7 million2. In the first four months of the year, Stadium's revenue is up 5% at constant currency, supported by the acquisition of PowerPax, with good growth in the higher margin Technology Products part of the business. Stadium's order book is ahead of the prior year, providing confidence of the business meeting our trading expectations.

 

We are creating a centre of excellence for engineering and manufacturing operations for TT in our Bedlington site in the North East of England. Bedlington is a strategically significant site for the Group and we are investing circa £3 million to create a fit-for-purpose facility to support our strategic development. Roughly two-thirds of the investment will be incurred in 2018.

 

During the period, we realised net proceeds of circa £4 million from the sale of a surplus site in Birtley, UK.

 

Summary and Outlook

 

Commenting on the trading update, Richard Tyson, Chief Executive Officer said:

 

"Momentum in our operational performance and order demand has continued into 2018, and we have increasing confidence of making strong progress in 2018. TT is growing, and we are investing to accelerate our strategy to make TT a higher margin business, providing increasingly value-added solutions to our customers.

 

The integration of Stadium is underway led by a dedicated team and we are refining our detailed synergy plan. We continue to review a number of acquisition opportunities where we can deploy capital to add complementary capabilities, customers and scope to TT."

 

 

 

 

For further information please contact:

 

TT Electronics plc            

Tel: +44 (0)1932 825 300

Richard Tyson, Chief Executive Officer

Mark Hoad, Chief Financial Officer

Emma Darke, Head of Investor Relations and Communications

 

 

MHP

Tel: +44 (0)20 3128 8794

Tim Rowntree / Katie Hunt

 

 

 

     

Notes

¹Excluding the impact of exchange rates, acquisitions and disposals

2Comprising the consideration for the issued share capital of £45.8 million and £13.9 million net debt as at 17 April 2018.

 

About TT Electronics

TT Electronics is a global provider of engineered electronics for performance critical applications. The Company works with market-leading customers in the industrial, aerospace and defence, medical, and transportation sectors. TT has three divisions, Sensors and Specialist Components, Power Electronics and Global Manufacturing Solutions.

The product offerings in the Sensors and Specialist Components division include circuit protection, current sensing, signal conditioning, optoelectronics, and sensors for torque, position, pressure, flow and temperature. The Power Electronics division typically designs and manufactures specialist, high reliability electronic components and sub-assemblies supplying into power management, engine controls and connectivity systems. The Global Manufacturing Solutions division provide high mix low volume manufacturing solutions for products in a wide range of end applications ranging from medical devices, to power control modules used in rail transport infrastructure.

 

Cautionary statement

This trading update contains forward-looking statements. These have been made by the directors in good faith based on the information available to them up to the time of their approval of this update. The directors can give no assurance that these expectations will prove to have been correct. Due to the inherent uncertainties, including both economic and business risk factors underlying such forward looking information, actual results may differ materially from those expressed or implied by these forward-looking statements. The directors undertake no obligation to update any forward-looking statements whether as a result of new information, future events or otherwise.


This information is provided by RNS
The company news service from the London Stock Exchange
 
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