29th Jan 2015 09:57
LONDON (Alliance News) - Haynes Publishing Group PLC Thursday said pretax profit fell in the first half of its financial year, as the strength of sterling hit translated overseas revenue and sales of printed manuals declined, and warned that it will not meet market expectations for the full year.
Haynes Publishing posted a pretax profit of GBP55,000 for the six months to end-November, more than half the GBP128,000 profit it reported a year before, as revenue declined to GBP11.9 million from GBP14.9 million. It said the strength of sterling reduced revenue by around GBP500,000, while sales of printed manuals fell.
Haynes said it thinks its performance can return to "more normal levels" in the second half of the year if the early signs of improvement in the first few weeks of the half are maintained, although it also warned that it won't be able to makeup the shortfall from the first half.
Hardman & Co and Charles Stanley Securities were both predicting that Haynes would report a pretax profit of GBP4.3 million in the full year to end-May, according to data on Morningstar. The company had reported a pretax profit excluding exceptional items of GBP4.2 million in its last financial year, a 31% increase on the previous year. Its revenue was GBP29.3 million, up from GBP27.6 million.
The automotive manual publisher maintained its interim dividend at 3.5 pence per share for the half year to end-November, despite the profit warning.
US revenue was down 20% in the half, compounded by the strength of sterling as softer ordering from a small number of customers offset growth from its new Clymer manuals range. UK revenue fell 31% as two key retailer customers reduced orders, while European revenue was down 7%, also hit by the strength of sterling.
Haynes Publishing said that inventory reduction programmes have hit all of its main consumer markets, and whilst it believes that the "worst" is behind it, this has hampered its first half results to the extent that it will not meet market expectations for the full year. The company recently implemented price increases in the UK, US and Australia.
Shares in Haynes were trading down 6.1% at 115.00 pence Thursday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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