Dialight 1H ’09 revenue stable, profits dip in tough trading conditions
LED specialists Dialight plc reported revenue unchanged at £34.6m but lower profit before tax at £0.5m (2008:£2.1m) for the six months ended 30 June.
Two-thirds of the Group's sales are denominated in US$ and the strengthening of the $ against sterling has had a positive effect on Dialight's results. The average US$:£ was 1.975 in 2008 compared to 1.49 in 2009.At constant currency Group sales were £28.2m and operating profit was £0.1m.
Group CEO Roy Burton said: "We are pleased to report a creditable performance in a period of extremely difficult economic conditions with all business segments reporting a profit."
The Cambridge-based group's share price slipped less than 1% on the news. Market capitalisation is now around £48m.
Mr Burton said the Signals/Illumination Division revenue grew by 12% (decrease of 11% at constant currency) and there was an increase in obstruction product sales driven by adoption of Dialight's dual strobe product in the US.
The Group has generated net cash inflows from operations of £5.4m (2008:£2.4m) representing 875% (2008: 122%) of operating profit. During the first half working capital reduced by £3.3m including a reduction in inventory of £2.5m. The Group also paid the final dividend to shareholders of £1.2m (2008: £1.2m).
Current trading and outlook
The company said that whilst the major economic downturn at the end of 2008 affected all of our businesses, the Board was pleased with the progress made in penetration of new markets and adoption of new products.
"Although we expect only modest improvement in our Indication business, the recently announced contracts for Obstruction Lighting and Meter Disconnects supported by the strong opening orders for European Traffic, lend support to significantly improved prospects for the second half of the year. We also confidently expect accelerated adoption of our strategically important white lighting products," the Board said in a statement.
The Board remains confident in the Group's prospects for the rest of the year and its ability to generate substantial sales of its Ultra Efficient Lighting products in the future.
