7th Jan 2014 09:50
LONDON (Alliance News) - BATM Advanced Communications Ltd Tuesday said it expects overall revenues for the full year ended December 31 to be in line with expectations, but profit below expectations due to a reduced contribution from its higher-margin telecommunications division.
The company, which makes telecommunications-network and medical-lab equipment technologies, said it expects full year revenues of around USD114 million, supported by a better-than-expected performance from its medical division.
However, it said it now expects earnings before interest, tax, depreciation and amortisation to be below market expectations at between USD2 million and GBP2.5 million.
In October, the company reported higher third-quarter sales, buoyed by higher medical product sales, and said it was therefore retaining its full-year outlook, which it had raised in August, for higher revenues and EBITDA than in 2012.
In the third quarter, 56% of sales came from its telecoms business, down from 58% a year ago, while medical division sales made up 44% of the total, up from 42%.
However, BATM said in Tuesday trading update that its telecom division received less-than-expected revenue from clients in the US and Latin America in the fourth quarter, and also was hit by currency depreciation between the Israeli shekel and the US dollar.
It said that despite a stronger performance from its lower-profit-margin medical division, the reduced contribution from high-margin telecoms will hit EBITDA, BATM said.
BATM said that as its medical division continues to expand globally, it expects trading momentum to continue into 2014, with higher sales and improving gross margins.
"Whilst the Telecom division continues to be vulnerable to macro-economic conditions...the group expects that trading in this division will firmly stabilise after the first quarter of 2014 and progressively improve thereafter," said BATM in a statement.
BATM Advanced Communications shares were amongst the biggest London fallers in early trading Tuesday, down 17% at 16.30 pence per share.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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