5th Aug 2015 08:55
LONDON (Alliance News) - Latchways PLC Wednesday said it has made progress with operations in the start of the new financial year and said its view on the full year remains unchanged.
Latchways, which makes safety devices that prevent construction workers from falling, said it has made considerable progress with the expansion of its sales team in the four months to August 4, which it said will be completed by the end of the year.
It said that the new geographic focus in the UK is working well and that it is already seeing a significant increase in its prospect bank, adding that the near completion of the team is expected to drive revenue from the second half of the year.
In Europe, recruitment is progressing well, and all positions should be filled by the end of the first half. Current order intake is encouraging, Latchways said, although the weakness of the euro is creating a drag on the sterling value of revenue and on margins.
In North America, the new recruits are generating good prospects, Latchways said, with discussions ongoing with several potential customers and trial systems being installed.
Latchways warned, however, that the recent acquisition of its largest competitor Capital Safety Group by 3M will hit its North American revenue, as 3M was its main US distributor for the Self Retracting Lifeline product range, a product category for which CSG has its own range. It did say though that it should not have a material effect on current year profit as the channel through 3M is relatively low-margin business.
Meanwhile, the rest of the world region has seen mixed trading, with relatively quiet installer business more than offset by the resumption of the roll-out of its Vertical systems by its largest Australian utility customer.
"Four months into the financial year, our view on the year is unchanged. We are progressing with our stated strategy and the early indications are that this will drive revenues significantly higher in due course. Given the timing of the recruitment process the impact on this year's revenues is expected to be mainly second half weighted, but we are encouraged by early progress. With our strong balance sheet we have the financial strength to invest wherever we see returns to be made," Latchways said in a statement.
Shares in Latchways were trading up 2.3% at 762.00 pence Wednesday morning.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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