TIDMSOLI
RNS Number : 6131R
Solid State PLC
30 October 2023
30 October 2023
Solid State plc
("Solid State", the "Group" or the "Company")
Trading Update
Solid State plc (AIM: SOLI), the specialist value added
component supplier and design-in manufacturer of computing, power,
and communications products, announces a trading update for the six
months ended 30 September 2023 (the 'Period' or 'First Half').
The Directors are pleased to report a strong first half trading
performance, including:
-- Revenues of approximately GBP88.0m (2022: GBP59.4m). Organic
revenue growth in the Period being in excess of 35% on a constant
currency basis;
-- Adjusted profit before tax* of at least GBP7.0m (2022:
GBP4.2m), reflecting a 67% year on year increase; and,
-- Strong cash generation from trading activities, contributing
to settlement of deferred consideration relating to previous
acquisitions, and paying down the Group's borrowings.
The strong revenue growth continues to be driven by delivery of
more than GBP23m of product under the initial and follow on
security and defence contracts, and the full period of contribution
from Custom Power. USD currency headwinds were slightly more than
GBP1m at a revenue level.
The Group continues to see strong demand from clients within the
security and defence sectors, with robust billings and order intake
in the First Half. However, as previously reported, we are seeing
clients move to more normalised levels of stocking because of
improving component lead times combined with the higher interest
rate environment, resulting in increased customer focus on managing
working capital.
The open order book at the end of September remained robust at
GBP99.7m (30 September 2022: GBP112.5m) with circa 60% expected to
be delivered in the current financial year. However, the shorter
lead times will enable more efficient conversion of the order book
into billings.
Post Period end, Solid State launched a Group-wide exercise to
ensure that its branding and web presence reflects the qualities of
the Group and positions its operating units most suitably to
optimise market penetration and cross-selling opportunities. The
recently announced rebranding of the Components division under the
trading name of "solsta" is a first step in this exercise.
The Board is very pleased with the ongoing delivery of Solid
State's growth strategy. As a result of the strong start to the
year, on a full-year basis, the Directors expect to deliver
stronger than anticipated organic revenue growth, meaning the Group
is expected to be marginally ahead of current consensus revenue and
adjusted PBT expectations for the year ending 31 March 2024.
*Adjusted performance metrics reported consistently with those
reported in the 31 March 2023 annual report, the adjustments relate
to amortisation of IFRS 3 acquisition intangibles, share based
payments charges and non-recurring charges in respect of
acquisition costs and fair value adjustments.
(1) The Company considers the average of the most recently
published research forecasts prior to this announcement by all
providers - Cenkos Securities plc, finnCap Group plc and WH Ireland
plc to represent market expectations for Solid State.
Market Expectations FY23/24 FY24/25
Revenue GBP147.3m GBP152.3m
---------- ----------
Adjusted profit before GBP11.9m GBP12.5m
tax*
---------- ----------
Net (debt) / cash (GBP3.1m) GBP1.0m
---------- ----------
Following completion of the merger between finnCap and Cenkos,
renamed Cavendish, the Company understands that the number of
entities providing research on the firm will consolidate from three
to two.
Investor Site Visits to Head Office in Redditch
Solid State holds site visits to its head office in Redditch
where operations from both the Systems and Components divisions can
be seen. Interested investors should contact
solidstate@walbrookpr.com .
This announcement contains inside information for the purposes
of Article 7 of the UK version of Regulation (EU) No 596/2014 which
is part of UK law by virtue of the European Union (Withdrawal) Act
2018, as amended ("MAR"). Upon the publication of this announcement
via a Regulatory Information Service, this inside information is
now considered to be in the public domain.
For further information please contact:
Solid State plc Via Walbrook
Gary Marsh - Chief Executive
Peter James - Group Finance Director
Cavendish Securities plc (Nominated
Adviser & Broker)
Adrian Hadden / Callum Davidson (Corporate
Finance)
Tim Redfern / Jasper Berry (Sales) 0207 397 8900
Walbrook PR (Financial PR) 020 7933 8780
Tom Cooper / Nick Rome / Joe Walker 0797 122 1972
solidstate@walbrookpr.com
Analyst Research Reports: For further analyst information and
research see the Solid State plc website:
https://solidstateplc.com/research/
Notes to Editors:
Solid State plc (SOLI) is a value added electronics group
supplying commercial, industrial and defence markets with durable
components, assemblies, manufactured units and power units for use
in specialist and harsh environments. The Group's mantra is -
'Trusted technology for demanding environments'. To see an
introductory video on the Group - https://bit.ly/3kzddx7
Operating through two main divisions: Systems (Steatite, Active
Silicon & Custom Power) and Components (Solid State Supplies,
Pacer, Willow Technologies & AEC); the Group specialises in
complex engineering challenges often requiring design-in support
and component sourcing for computing, power, communications,
electronic, electro-mechanical and opto-electronic products.
Headquartered in Redditch, UK, Solid State employs approximately
400 staff across the UK and US, serving specialist markets with
high barriers to entry in industrial, defence and security,
transportation, medical and energy.
Solid State was established in 1971 and admitted to AIM in June
1996. The Group has grown organically and by acquisition - having
made three acquisitions in the last three years.
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END
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