28th Apr 2015 08:15
LONDON (Alliance News) - AB Dynamics saw its shares rise to a new all-time high Tuesday morning after it reported strong growth in pretax profit in the first half of its financial year, driven by a 13% rise in revenue and as its new robot assembly facility increased efficiency and helped push up margins.
The maker of testing and measurement products for vehicle suspension, brakes and steering that are used in automotive research and development also said its order book is strong and it raised its interim dividend to 1.1 pence, from 1.0p a year earlier as its balance sheet strengthened. It said current trading is meeting its expectations.
AB Dynamics reported a pretax profit of GBP1.5 million for the six months to February 28, up from GBP1.2 million a year earlier, as revenue rose to GBP7.6 million from GBP6.7 million.
The profit rise also came as its margins were lifted by the new robot assembly line that came online last year as well as the introduction of its higher-margin new Track Testing products. It also benefitted from the recent establishment of a Japanese entity that's supporting all of its products in the region through a single entity.
Management was also positive about the outlook, saying it expects the global automotive industry to invest more money in research and development as manufacturers seek to develop cars that meet new regulations and also due to the stiff competition between the car makers.
The company is headquartered in Bradford on Avon and currently supplies all the world's top twenty auto makers, including Honda, Toyota, Ford and Volkswagen.
"The European and Japanese car makers continue to invest heavily in the field of Advanced Driver Assistance Systems, where our package of Driverless Robots synchronising with our latest Soft Targets, assist the automotive industry in meeting the latest vehicle passenger and pedestrian safety standards, such as Euro NCAP," the company said.
AB Dynamics had net cash at the end of the half of GBP7.0 million, up from GBP4.6 million a year earlier.
"The group continues to go from strength to strength: the progress of the new factory remains on track with completion expected in the latter part of 2016; and the company continues to successfully attract key personnel having passed the 60 employees landmark," Managing Director Tim Rogers said in a statement.
AB Dynamics shares were up 5.6% at 204.88 pence Tuesday morning, having been in an upward trend for the whole of 2015. The stock is up 36.5% in the year to date.
By Steve McGrath; [email protected]; @stevemcgrath1
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