Somerset manufacturer predicts return to growth by end of the year
Specialist manufacturer Gooch & Housego says it expects to see a return to growth at the end of the financial year.
The Somerset manufacturer of photonic components and systems has published a trading update for the last six months.
In the first half of the financial year some customers in its industrial and medical laser markets normalise their inventory holdings resulting in lower levels of demand for some products.
This period of destocking is expected to come to an end towards the end of this calendar year and revenue from these markets will then return to growth.
In other areas, most notably the medical diagnostic business and fibre optic businesses, which supply the semiconductor infrastructure markets, revenue has grown compared with the comparator period.
Revenue for the six month period is expected to be £67.5m compared with £71.3m the previous year.
Gooch and Housego expect trading in the current financial year to be more heavily weighted towards the second half.
New orders for the Group’s products from the semiconductor, sub-sea data cable and aerospace navigation markets have been strong.
At 31 March 2024 the group’s order book stood at £115.8m a decrease of 6.9%.
The firm expects trading for the full year to be in line with management’s previous expectations.
Chief executive Charlie Peppiatt said: “Despite the lower volumes in the first half of the financial year resulting from a prolonged period of inventory adjustment by some of our customers we have continued to focus on the delivery of our strategic objectives. In line with our commitment to become a more customer focused business, we have further improved our operational performance reducing our overdue backlog and lead times.
“Our investment in new technologies and products is recognised by our customers and we have secured important new contract wins in the period. Following the strategic addition of the GS Optics and Artemis Optical businesses in FY2023, we have already been rewarded with new customer orders as a result of the Group’s enhanced portfolio.
“The divestment of our EM4 business in March this year represented an important milestone on our journey to focus our A&D business on those areas where we can secure acceptable returns, supporting the Group’s path to mid-teens profitability.”
