Electronics group Solid State targets further growth after third year of record results
REDDITCH-based electronics group Solid State has said it will continue to strive for growth and seek further acquisitions to build on its third consecutive year of record results.
The AIM listed supplier of industrial/ruggedised computers, specialist electronic components and battery power solutions said revenues for the year to March 31, 2013 grew by 22% to £31.50m (2012: £25.87m) with pre-tax profits rising by 17% to £1.87m (2012: £1.60m) before exceptional costs of £100,000 relating to relocation costs of £85,000 and abortive acquisition costs of £15,000.
It said the £3.5m export contract delivered in the first half of the year illustrated the margin variation it experienced due to order size and product mix which resulted in first half gross margins declining to 24.4%. However, as it indicated in its interim statement, gross profit margin improved in the second half to 27.9% in line with recent years (2011 & 2012: 27.8%).
Operating margins after exceptional costs were stable at 6.2%, again in line with recent years (2011: 6.1% & 2012: 6.4%), with earnings per share increasing by 12% to 21.8p (2012: 19.5p).
Total net assets strengthened by 23% to £6.3m (2012: £5.1m) with the group’s net gearing levels being 37% (2012: 53%).
The board has recommended a final dividend of 5.25p. An interim dividend of 2.75p per share was paid on January 28 giving a total dividend for the year of 8p per share, a 10% increase on the 2012 figure of 7.25p. The final dividend will be paid on September 2 to shareholders on the register at the close of business on August 9, 2013.
It said the current year had started as anticipated and order books remained strong, with a backlog of £10.4m as at April 30, 2013 (March 31, 2012: £10.5m).
“We will continue to drive organic growth and seek further acquisitions that complement our existing operations and benefit shareholders,” it said.
The £0.9m acquisition of microwave and RF engineering specialist Q-Par in May is said to have been successful and has helped to extend product offering and client base in a high margin environment.
Gordon Comben, chairman, said: “These results highlight the positive momentum at Solid State, delivering our third consecutive year of record results. In recognition of this performance and future prospects the board is recommending a 10% increase in the annual dividend.
“The recent acquisition of Q-Par is further evidence of our commitment to making complementary acquisitions to strengthen our position in global niche markets and to continue our growth strategy.”
Solid State owns a group of companies providing specialist design-in and value added manufacturing services to businesses using industrial/rugged computing products, battery power solutions, antennas, microwave systems and electronic components in harsh environments.
It serves niche markets in oil & gas production, medical, construction, security, military and field maintenance. The business acts as both a distributor to OEMs and bespoke manufacturer of specialist units to clients with complex requirements.
Headquartered in Redditch, Solid State employs over 140 staff across four sites. It operates through two main divisions: Steatite and Solid State Supplies.
