30th Jun 2009 07:00
30 June 2009
LAIRD PLC
PRE-CLOSE TRADING UPDATE
Laird PLC ("Laird") today issues an update on trading in the first half of 2009, ahead of the announcement of its Interim Results on 30 July 2009.
Laird is a focused electronics and technology company, a leader in the design and supply of performance critical components and systems for wireless and other advanced electronics applications: Laird provides innovative technology for a connected world.
As previously reported, our business has been affected by the challenging macroeconomic conditions and supply chain de-stocking in the second half of 2008 and which have continued through the first half of this year. In the first half of 2009, like-for-like revenues are expected to have declined by some 35% on a constant currency basis compared with the very strong first half of 2008, with all three of our divisions affected by the lower demand. When reported in Sterling, the year-on-year revenue decline is expected to be some 15%.
Like-for-like revenues in the second quarter of 2009 are expected to be slightly lower than those in the first quarter, and we have yet to see any benefits from an end to de-stocking in the global supply chain or a pick-up in underlying demand. The trading performance of our Telematics antennae business has been affected by the bankruptcy filings of Chrysler and General Motors, although we do not expect to incur any write-offs as a result of these filings. The weakening of the US Dollar against Sterling will also adversely affect the translation of our revenues and profits.
Our underlying profit margin percentage, before interest and tax, in the first half is expected to be in mid single digits, below that in the first quarter. While we are benefiting from the prompt actions we have taken to reduce costs we still expect, as previously announced, that first half performance will be considerably below the strong levels seen in the first half of 2008.
Working capital continues to be managed in line with demand, capital expenditure in the period is expected to be below depreciation, and operating cash conversion after capital expenditure is expected to be in excess of 100%. These factors, together with currency translation effects, will result in a reduction in our net debt at the half year compared with the end of December 2008.
Although visibility of customer demand is limited and we remain cautious as to the timing of an overall market recovery, we expect to see a pick-up in demand for our products during the second half of this year, as a result of new customer and programme awards and some replenishment of inventories in the global supply chain. We also expect to see benefits in the second half from the cost reduction actions that we have previously announced, and from further actions that we have implemented during the first half of this year.
We are expanding our customer base, our businesses are continuing to develop innovative new families of products, and we are seeing the benefits of our engineering and technology focus with new programme awards. We are also seeing an increased number of requests for quotations, and are making good progress in further strengthening our position with some key customers. We believe that the fundamentals of our markets remain attractive and that our businesses are well positioned as these markets return to growth.
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For enquiries: |
Laird PLC: |
Maitland: |
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Peter Hill, Chief Executive |
Brian Hudspith |
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Jonathan Silver, Finance Director |
Suzanne Bartch |
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Tel: 020 7468 4040 |
Tel: 020 7379 5151 |
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