Electronics group sees near 30% increase in full year profits
ELECTRONICS group Solid State, which owns Redditch-based rugged systems supplier Steatite, has announced a near 30% increase in annual profits.
The group, which saw turnover increase 22%, said it had seen a strong performance from all its operations.
Gordon Comben, Solid State chairman, said: “These results demonstrate the value of building embedded partnerships with our clients in targeted niche sectors. This is the second successive year of record results.
“We continue to see opportunities for both organic and acquisitive growth in a market which demands increasing levels of product customisation. This plays very much to our strengths, the prospects for Solid State are extremely positive.”
Revenues increased by 22% to £25.87m (2011: £21.17m) with pre-tax profit rising by 29% to £1.60m (2011: £1.24m). Underlying growth in the core business, excluding costs of £223,000 associated with the recent acquisition of the trade and assets of Blazepoint Ltd saw revenue increase by 20% and profits increase by 34%.
The group said it was experiencing margin variation due to order size and product mix, however, it retains its ability to command good margins due to the value added nature of its offering. It added that despite lower margins in the first half due to the product mix and continuing margin pressures resulting from the difficult economic conditions, gross profit margins were maintained at 27.8% for the year as a whole.
The operating margins increased to 6.4% when included the gain on the acquisition of Blazepoint Ltd (2011: 6.1%).
It said its balance sheet continued to strengthen. Total net assets increased 30% to £5.1m (2011: £3.94m). Working capital requirements increased in line with sales and at the year end the company had a net gearing level of 47% (2011: 40%).
Steatite designs, manufactures and supplies a range of products that include bespoke Lithium battery packs, rugged mobile computing/radio solutions and industrial computer hardware and software.
Key to its strategy is the ability to design, manufacture and test to customer requirements for usage in some of the most difficult and harsh environments against the most stringent of standards and qualifications.
Steatite went into the second half with a large order book. Sales increased during the year by 14% while profit increased by 22.5%. In October 2011 the company acquired the trade and assets of Blazepoint and traded the business as Steatite Blazepoint Ltd for the balance of the fiscal year.
For the year ahead Steatite Blazepoint will trade as a division of Steatite Ltd with most of the restructuring having taken place. This will enable it to contribute within Steatite to a greater level enhancing its product range and prospects for the year ahead.
The board said the prospects for Steatite remained positive for the year ahead. It said it continued to add to a strong order book and is competing and winning some major contracts.
