Datong confident it can hit targets
SECURITY equipment company Datong plunged into the red in the first of the year after delays to key orders but said today it is confident of hitting targets for the full year.
The Leeds-based group, which makes security equipment used by international security organisations to track drug dealers and terrorist suspects, is now expecting to see two substantial orders for £2.9m in the second half of its current financial year.
However chairman Paul Lever said: “Given the delays so far in receiving orders, the current economic conditions and the heavy reliance on the signing up of contracts in the second half of the financial year, we recognise that the risk to the year end result is increasing.”
Chief executive Brian Smith said: “We have good visibility over Datong’s order flow for the rest of the year and, at present, still believe that the group will meet market expectations. Delays in certain large customer orders in the period will place greater emphasis than usual on the traditionally stronger second half year period.”
The group saw revenue drop by more than half to £1.51m from £3.52m during the six months to September 30 because of the order delays and that saw a pre-tax loss of £1.62m rather than its traditional break-even position for the first half.
Datong made a loss per share of 9.32p and had net cash of £1.7m at the half year.
“We remain focused on Datong’s long term growth strategy and are confident that the investments made in capability, product portfolio and customer reach will underpin continued growth” said Mr Smith.
He said that the group has a strong order pipeline in resilient markets and it is adding four upgrades to its product range with one a device which allows security services to track individual suspects rather than the vehicles they are travelling in.
Mr Smith said that recent events in Mumbai and Thailand highlighted the continued focus on homeland security and counter terrorism with budgets for high technology and intelligence management products for use by special forces groups remaining reasonably resilient, despite the broader economic uncertainty.
The group has benefited from the stronger dollar and Mr Smith said that for every $1m of sales it makes in the US, it now makes an additional £100,000 thanks to the falling value of the pound.
Mr Smith said that the recruitment of Rolls-Royce and Smiths Group executive Dean Blood as chief operating officer in September added significant experience and also provided a clear succession plan for when he steps down as chief executive.
In America Datong has appointed former US police chief and FBI officer Louis Quijas as president of its US business and is confident it can benefit from his network of contacts in the security services in both North and Central and South America.
