15th Aug 2024 12:44
(Alliance News) - Gooch & Housego PLC shares traded lower on Thursday, as "delivery delays" are likely to knock about GBP1.5 million off its full-year profit.
The stock was down 4.2% at 456.00 pence early on Thursday afternoon in London.
The Somerset, England-based photonics components and systems manufacturer reminded investors that "the pattern of trading in FY2024 is more heavily weighted than normal towards the second half", thanks to "a period of prolonged destocking by our industrial and medical laser customers".
Gooch first flagged this headwind in its half-year results in early June, when it reported that pretax profit dropped to about GBP300,000 from GBP3.6 million a year before. Revenue edged down to GBP63.6 million from GBP64.5 million, which Gooch said reflected the customer destocking.
On Thursday, Gooch & Housego said it still expects to increase output during the current half year. However, it also anticipates that "some revenues [will] be delayed out of the current reporting period, principally as a result of both supplier and customer delivery delays".
Consequently, Gooch said, its adjusted pretax profit for the year ending on September 30 "may be" approximately GBP1.5 million lower than was previously anticipated.
More positively, Gooch & Housego said its order book "has continued to grow" and totalled GBP116.8 million as of July 31, up from GBP115.8 million at March 31, and that its balance sheet "remains strong".
Gooch also said it "continues to deliver on its strategic growth plan that sets a path to mid-teens profitability".
In particular, it said the integration of its recently-acquired Artemis and GS Optics businesses "has progressed well", and is expected to "open new programme revenue streams...in the coming months". Moreover, its "transfer of selected product lines to contract manufacturing partners in lower cost regions continues to progress to plan".
Going forward, Gooch & Housego said its trading outlook for financial 2025 remains unchanged.
"Whilst it is disappointing that our near-term trading has been impacted by a number of factors outside of our control, I am pleased with the progress that we continue to make in establishing the foundations to deliver our strategic objectives," commented Chief Executive Officer Charlie Peppiatt.
"I am optimistic that with the sustained recovery of our industrial markets expected in 2025 combined with the benefits of the improvement activities and focused investments we are making across the business we are well positioned to return [Gooch & Housego] to mid-teens returns."
By Emma Curzon, Alliance News reporter
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