18th Aug 2015 06:45
LONDON (Alliance News) - APC Technology Group PLC said Tuesday that whilst it expects to meet market expectations for its full year revenue, its underlying operating profit for the year to end-August will fall below market expectations.
The electronic components supplier said that following a detailed project profit margin analysis in its three main operating divisions, it has become clear that margins achieved by its Minimise Energy business have been hit by excessive freight charges and other costs it incurred to meet delivery times on a number of contracts.
It also expects its Minimise Generation and Minimise American businesses to fall short of its expectations for the full year, as contracts in the UK market have not materialised as expected, and business in the Americas has developed more slowly than previously expected, partly due to the short-term fall in energy prices.
As a result of these issues the company's Chairman Leonard Seelig will lead an operational review of the business.
APC reiterated confidence in its short, medium and longer term prospects, and said it expects to report its findings from the operational review in late autumn.
"It is disappointing that after considerable effort and investment, the Generation and American businesses have not been able to deliver the contracts and growth expected. While this is in part due to wider market conditions, it has had an impact on the group, given our stage of development, and we have taken appropriate action to address this looking forwards," Seelig said in a statement.
"My role in leading the operational review will now be to focus the business on those divisions in order to strengthen the group's balance sheet and to deliver a profitable and cash generative business in future periods," Seelig added.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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