Security firm gambles on success as casino business cashes in
Warwickshire security and surveillance group, Synectics has enjoyed a strong year boosted by the performance of its gaming division.
For the year to November 30, 2016, consolidated revenue increased by 4% to £70.9m (2015: £68.5m). The group made an underlying profit of £2.6m (2015: £1.4m). After charging £0.7m (2015: £0.9m) for exceptional items, the consolidated pre-tax profit was £2m (2015: £0.5m).
Underlying diluted earnings per share were 12.4p (2015: 7.2p) and diluted earnings per share were 8.8p (2015: 2.5p). The group’s balance sheet continued to strengthen, with net cash at year-end of £2.2m (2015: £0.5m). The group’s order book at year-end was £26.2m (2015: £26.6m).
In light of the improved results and positive cash position, the board has recommended an increased final dividend of 2.0p per share (2015: 1.0p).
The Gaming business enjoyed an exceptionally good year, delivering large integrated systems to three major resorts during the period. Revenues from the sector increased by nearly 20% and profits more than doubled.
It secured a number of high profile gaming contracts in 2016 including a multi-million dollar 6,000-channel project in Manila, a 5,000 channel premier resort on the Las Vegas Strip for Wynn, a major new-build integrated resort in Macau, and two next generation mega cruise ships based in the Asia-Pacific region.
The group has performed well in Asia over the last few years, on the back of its systems being chosen for a significant proportion of the new large gaming-related resorts being built across the region. While the current rate of new build projects is slowing down, the group said it had a strong installed base in this area and prospects for the future were sound.
It also said there were signs of the US gaming market returning to normal after a period of flat or declining activity, which bode well for the future.
However, not all its sectors were as buoyant.
It said that given the long lead times for major oil & gas projects, it did not expect any material improvement in market conditions in that sector in the coming year.
Nevertheless, it said it was optimistic that other business areas would move ahead significantly in the current financial year, building on the increased momentum established in the latter part of 2016.
Commenting on the results, Paul Webb, chief executive, said: “We will continue to build on the progress we have made, and I strongly believe that the actions we have already taken leave us better placed to deliver for our customers, and ultimately our shareholders – now and into the future.
“From our strong heritage in public space surveillance we have developed market-leading positions globally in gaming and oil & gas, as well as the UK bus & coach market.
“Great technology, a flexible attitude, and deep sector expertise are what set Synectics apart – and the business is well positioned for significant further growth.”
