13th Oct 2016 07:50
LONDON (Alliance News) - Electronic products designer and distributor Acal PLC on Thursday said it expects first-half results to meet its expectations and said it will restructure its Custom Distribution business.
Acal said its expects double-digit growth in underlying operating profit in the first half to the end of September, in line with its previous forecasts, and its outlook for the year to the end of May 2017 remains unchanged. Orders in the first half were up 18% and sales grew 10% year-on-year.
First half organic sales slowed but orders have increased since the soft first quarter, leaving the group in line to meet its organic sales targets for the full year, it said.
Acal said profit margins held up in the first half despite some softness in organic sales and noted it has got a currency translation benefit to its results from the weak pound.
Acal added it will implement a restructuring programme in its Custom Distribution arm, which provides customised electronic, photonic and medical products to manufacturers. The company will reduce the number of managers in the unit, close one unprofitable business unit in Europe and cut administrative costs, while maintaining a customer and sales focus for the division.
Acal will book an GBP8.0 million one-off cost in its current financial year and expects the move will deliver annualised cost savings of GBP4.0 million from its 2018 financial year and beyond.
Acal will publish interim results on November 29.
Shares in Acal were down 1.9% to 258.75 pence on Thursday.
By Sam Unsted; [email protected]; @SamUAtAlliance
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