19th Mar 2025 12:53
(Alliance News) - Nexteq PLC shares fell on Wednesday as it reported decreased revenue and profit due to the impact of customer destocking on volumes.
The Cambridge, England-based technology solutions for manufacturers of electronic equipment company said pretax profit fell 87% to USD1.7 million in 2024 from GBP12.9 million in 2023.
Revenue was down 24% to USD86.7 million from USD114.3 million. Cost of sales fell 24% to USD55.6 million from USD72.8 million.
Shares in Nexteq were down 8.0% to 62.56 pence in London on Wednesday afternoon.
Nexteq said its margin was impacted by USD2.7 million of charges to reduce the carrying value of Aruze stock. The company also faced a USD2.9 million goodwill impairment and restructuring costs of USD700,000.
Adjusted pretax profit fell 67% to USD4.8 million from USD14.7 million.
Nexteq proposed a dividend of 3.7 pence per share for 2024, up 12% from 3.3p in 2023. The company said this reflected "confidence in the long-term prospects of the business and strong cash generation".
Chief Executive Officer Duncan Faithfull said: "2024 was a challenging year for Nexteq, with a significant impact on volume driven by continuing destocking across our customer base, and the wider economic environment, characterised by high interest rates, which impacted our customers' willingness to invest."
Looking ahead, Nexteq said it is aiming to deliver between USD108 million to USD120 million revenue by the end of 2027 with a "consistent growth trajectory".
"This will be achieved through a combination of organic, innovation and acquisitional growth," the company said.
"The board is excited about the three-year plan and remains confident that our renewed focus on creating innovative technology solutions will unlock the growth potential of the business, with 2025 being a year to focus on our current strong customer relationships; winning and integrating new customers; and diversifying our revenue streams, with the objective to deliver growth from 2026," CEO Duncan Faithfull said.
"Nexteq's impressive cash reserves provide the senior leadership team with the opportunity to invest to accelerate growth in our target markets, and to further diversify the group. We look ahead with a clear plan, robust financial position and established, market-leading position from which to grow."
By Michael Hennessey, Alliance News reporter
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