21st Jul 2015 08:23
LONDON (Alliance News) - Synectics PLC has reduced its expectations for its full year, despite seeing a first half performance "slightly ahead" of its expectations with a narrowed pretax loss, due to increased market uncertainties in oil and gas.
Synectics provides security and surveillance systems.
For the half year to end-May, the company posted a pretax loss of GBP134,000, narrowed from a pretax loss of GBP2.6 million a year earlier, as revenue rose to GBP32.6 million from GBP31.8 million, and operating expenses fell to GBP9.9 million from GBP10.9 million.
The company attributed its performance to a reduced cost base after restructuring it undertook last year and to the closing out of a large loss-making contract in its integration and managed services division.
However, Synectics highlighted uncertainties in the oil and gas market, which is its largest customer sector, with delays in existing projects and in decisions on new investments by customers. Whilst it believes its new software and product suite is helping it to gain market share, the timing of new contracts and revenue remain difficult to predict, Synectics said.
Despite reducing its expectations for the full year, Synectics said it still anticipates solid underlying profitability and a continuing trend of improvement for its second half and for 2016.
"We have made solid progress implementing the recovery plan and fixing the performance issues within our control. Although continuing market uncertainties have led to a reduction in our profit expectations for the full year, the first half result is a solid indication that we are addressing the right things and focussing our efforts on the areas of critical importance," said Chief Executive Paul Webb in a statement.
Shares in Synectics were trading down 3.2% at 167.00 pence Tuesday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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