Filtronic PLC Trading Update & Notice of Final Results (3860P)
June 20 2022 - 1:00AM
UK Regulatory
TIDMFTC
RNS Number : 3860P
Filtronic PLC
20 June 2022
20 June 2022
Filtronic plc
("Filtronic" or "the Group")
TRADING UPDATE AND NOTICE OF RESULTS
Positive Trading Momentum maintained as improved second-half
lifts earnings and net cash at year-end
Filtronic plc (AIM: FTC), the designer and manufacturer of
products for the aerospace, defence, telecoms infrastructure and
critical communications markets, is pleased to provide the
following trading update for the financial year ended 31 May 2022
("FY2022").
As reported in the February interim statement, we continue to
build momentum in the business as we develop in our strategic
markets. We are pleased to report top line growth and that adjusted
EBITDA is set to exceed market expectations despite the challenges
of the global semiconductor shortage. This strong trading
performance will enable us to continue to make strategic
investments in the future of the business.
Financial highlights
Trading in H2 of the financial year was 13% higher than H1
enabling the Group to deliver revenue broadly in line with market
expectation, giving year-on-year revenue growth of 10%. However, a
strong sales mix and tight control of overhead costs resulted in
adjusted EBITDA being materially ahead of forecasts. The Board
therefore expects, subject to audit, to report FY2022 revenue of
approximately GBP17.1m (FY2021: GBP15.6m) and adjusted EBITDA of
not less than GBP2.7m (FY2021: GBP1.8m). Cash at bank on 31 May
2022 was GBP4.0m (30 November 2021: GBP3.0m). Net cash (net of all
lease obligations except right of use property leases) at 31 May
2022 was GBP3.1m (30 November 2021: GBP2.2m).
Operational highlights
The results are particularly pleasing given the headwind from
post-covid material availability in the semiconductor supply chain.
Whilst we are not immune from the disruption, to date, we have been
able to leverage the stronger balance sheet by securing inventory
early, in addition to having product design under our direct
control which keeps us agile in both sourcing inventory and
requalifying alternative sources of supply. We are also pleased to
close the year with some significant repeat orders for delivery in
FY2023 giving a stronger order book and greater visibility than
when we entered the year.
Demand for telecommunication infrastructure products increased
steadily throughout the year and despite challenges with lead-times
and shortages of critical semiconductor components we were able to
keep pace with the growing orderbook for Xhaul products that
support the deployment of 5G networks around the world.
Demand profiles in the aerospace and defence market remain
resilient and we have continued to make good progress, securing
follow-on orders for development programme wins registered in the
last year. Increased business development and marketing activities
are also starting to yield positive results with a number of
development contract wins from new customers who are influential
players in this market. This is supported by an opportunity
pipeline that continues to build in terms of both quality and
value.
The critical communications market sustained most of its
post-Covid recovery as USA federal and state funding reverted to
the maintenance and support of infrastructure for first responder
P25 networks. In particular, we were encouraged by demand for our
"best-in-class" Tower Top Amplifier ("TTA"). The TTA product
launched in 2020, is finding its way into a significant number of
new critical communications projects and sales are exceeding our
initial expectations. Our USA onshore assembly facility in
Salisbury, Maryland, provides a significant advantage during a time
when Chinese supply chains are under pressure. However, as
electronic component supply chain issues continue, our customer's
ability to build complete P25 network solutions is constrained,
resulting in some rescheduling of orderbook and forecasts.
Investment has been made in our manufacturing capability and the
engineering and business development resources necessary to access
adjacent opportunities in the defence and fast developing
non-terrestrial networks ("NTN") market. The NTN market will make
it possible for future 5G telecom networks to be built using
High-Altitude Platforms ("HAPS") and Low Earth Orbit ("LEO")
satellite arrays, and several companies are developing solutions
designed to support HAPS and LEO 5G networks. Our technology is a
potential key enabler in this sector and in line with our plan to
penetrate this high-growth market, we are actively engaged with
major industry players.
Results for the financial year ended 31 May 2022 will be
announced on 2 August 2022.
Richard Gibbs, Chief Executive Officer, said:
"Throughout the year our primary markets have all continued to
show a robust post-Covid recovery and, notwithstanding ongoing
disruptions caused by shortages of electronic components, we have
delivered another strong set of trading results for the financial
year. Top line growth of 10% and a third consecutive year of
improved adjusted EBITDA and cash generation demonstrates the core
strength of the Filtronic business as we continue to make good
progress in pursuit of our long-term strategic goals.
"The delivery of key semiconductor components will remain an
industry-wide challenge for the foreseeable future, but we believe
we have the resources to manage the disruption to our business and
we start the new financial year with a strong order book and
optimism to deliver further growth next year".
Enquiries:
Filtronic plc Tel. 01740 618800 or investor.relations@filtronic.com
Richard Gibbs (Chief Executive
Officer)
Michael Tyerman (Chief Financial
Officer)
finnCap Limited Tel. 020 7220 0500
Jonny Franklin-Adams/Tim Harper (Corporate Finance)
Alice Lane/Sunila de Silva
(ECM)
Walbrook PR Limited Tel. 020 7933 8780 or filtronic@walbrookpr.com
Paul Vann/Joe Walker Mob. 07768 807 631
Notes:
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of Article 7 of Regulation (EU) No 596/2014.
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