13th Mar 2014 10:12
LONDON (Alliance News) - TT Electronics PLC raised its total dividend for 2013, as pretax profit was hit by restructuring costs which offset rising revenue.
TT Electronics posted a total dividend of 5.4 pence, up 8.0% from 5.0 pence in the previous year.
The company posted a pretax profit of GBP18.3 million, down from GBP22.0 million in the previous year, despite revenue rising to GBP532.2 million from GBP476.9 million. Profit was hit by higher administrative expenses and exceptional charges of GBP11.2 million relating to the restructuring of its business. Administrative expenses rose to GBP49.0 million from GBP35.5 million.
TT is implementing its 'Operational Improvement Plan' which it announced in 2013, with the objective of transitioning to a focused electronics business. The programme is intended to improve the company's operational efficiency by consolidating some of its manufacturing operations and closing overseas sales offices.
As part of this plan TT has established a focused Sensing and Control business division. It bought the minority interest in its Indian business from its commercial joint venture partner, and invested in its Indian engineering facility and European centre of research and development.
TT expects the programme to produce benefits of around GBP8 million per year starting in the second half of 2015, and to have an overall exceptional cost of around GBP30 million over three years.
The company will shortly be launching a new TT Electronics brand to better represent its new identity as the strategic programme progresses.
Positive trends in order bookings in the second half of 2013 have continued into the first quarter of 2014, TT Electronics said. This, combined with the transformation programme, means it is on track to deliver sustainable double-digit margins in 2014.
"2014 will be an important year as we embed the new Sensing and Control division, continue to simplify our structures, drive product innovation, implement the Operational Improvement Plan and enhance customer relationships across our key markets," said Chairman Sean Watson in a statement.
Shares in TT Electronics were trading up 0.6% at 222.50 pence Thursday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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