5th Aug 2019 11:43
(Alliance News) - Dialight PLC on Monday said it swung to a loss in the first half of 2019 due to the ramp up of its Penang facility in Malaysia.
In addition, the LED lighting company said Chair Wayne Edmunds will step down and will be replaced as chair by Non-Executive Director David Blood, with immediate effect.
Dialight said Blood is co-founder & senior partner of Generation Investment Management, a 20% shareholder in Dialight, and is therefore not considered "independent", but the company said it considers Blood to be independent in "character and judgement".
Edmunds said: "The company has experienced a challenging few years. However, it is now well positioned for the future, and I feel it is an appropriate time to step down from the board."
Dialight said it swung to loss of GBP2.1 million in the six months to the end of June, compared to the GBP2.7 million profit reported a year earlier, as revenue slipped to GBP76.1 million from GBP77.7 million.
US Lighting revenue was 2% down at constant currency on the prior year, the company said, as the extended lead times on the smaller product lines in the past hurt this region, coupled with a general softening in end markets.
The European Lighting business's revenue was 27% down on the previous year at constant currency. This region was held back by the ramp up of the Penang facility in Malaysia, which serves the European region.
More positively, Dialight said it saw the strongest growth in the Asia-Pacific region, which achieved 6% growth at constant currency.
"Our first half of 2019 financial results were disappointing. Lighting revenues were impacted by some softening of end markets and delayed market share recovery," said Chief Executive Marty Rapp.
Looking ahead, Rapp said: "We remain confident that the combination of the reputation of Dialight products as the best in the market, our improved operational performance, and the launch of our exciting new products will result in significant long-term growth in revenue and profit."
Dialight said its expectations for 2019 remain for underlying operating profit within the range of GBP10 million to GBP13 million, which is before incurring GBP4 million of non-underlying costs.
The stock was trading 5.9% lower on Monday in London at 367.00 pence a share.
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