6th Aug 2024 11:17
(Alliance News) - Spirent Communications PLC on Tuesday said customer caution ahead of its proposed takeover delayed contracts, sending the company into loss in the first half of 2024.
Crawley, England-based Spirent provides testing and assurance services. Back in March, it agreed to a GBP1.16 billion takeover by Keysight Technologies In, a Santa Rosa, California-based manufacturer of electronics test and measurement equipment and software.
Spirent already had flagged the "customer hesitancy" in a trading update last month, so its shares were trading flat at 171.00 pence on Tuesday morning in London. The takeover offer from Keysight is worth 201.5p per share in total, including 199.0p in cash and a 2.5p special dividend.
Spirent said it swung to a pretax loss of USD7.5 million in the six months that ended June 30 from a USD4.8 million profit a year before, as revenue fell by 12% to USD197.3 million from USD223.9 million.
Order intake during the half-year was USD188.8 million, down 21% from USD239.4 million a year previous, leaving Spirent's order book at the end of June at USD284.2 million, down 6.3% from USD303.4 million a year before.
"In the second quarter we experienced delays to contract placements as customers digested the information" about the Keysight offer, said Chief Executive Officer Eric Updyke. "There have been no order cancellations."
"The challenging market conditions witnessed in the first half are expected to continue in the second half," Spirent said, "and we expect this will be reflected in our near-term performance."
Spirent said it and Keysight continue to work constructively with regulatory authorities to get the deal approved. It expects the takeover to complete in the first half of financial 2025, meaning between November and April.
By Tom Waite, Alliance News editor
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