Business

Filtronic back in profit after strong second half sales

North East and Yorkshire telecoms manufacturer Filtronic has hailed its strong cash platform after reversing last year’s losses to return to profit.

Revenues dipped from £17.2m to £15.6m during the year ended May 31 2021, as delays to key programmes in the first six months and the impact of the pandemic on a key market knocked sales.

However, last year’s operating loss of £200,000 was converted to profit of £600,000, and last year’s overall loss of £2m bounced back to profit of £100,000, on the back of 20% revenue growth in the second half of the year.

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Adjusted Ebitda was £1.8m, up from £1.2m, and adjusted operating profit was also up from £400,000 to £600,000.

Filtronic designs and manufactures antennas and filters for the aerospace, defence, telecoms infrastructure and critical communications markets from three bases – its largest in Sedgefield, County Durham, alongside sites in Yeadon in Leeds, and Maryland, US.

Chairman Roger Gott said its healthy cash position would be used to drive further organic growth, which is showing strong signs of recovery from the pandemic with a stronger order book.

During the year the company – which won a Queen’s Award for Enterprise in International Trade 2021 – was awarded a £1.3m contract to develop and supply battlefield radio communications equipment, and its “best-in-class” Tower Top Amplifier saw its first significant revenue recognition in the last quarter of the year.

Meanwhile, it expanded its direct and indirect sales channels in the US, Europe and Asia through a mix of agents and distributors to expand its sales reach, countering the difficulties it had engaging with customers at the start of the pandemic.

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Mr Gott said: “Our healthy cash reserves and continued generation of EBITDA provide a solid platform from which to build the business and make the necessary investments to facilitate further revenue growth.

“The biggest challenge we faced throughout the pandemic was customer engagement and new customer acquisition due to travel restrictions.

“We countered this by expanding our channels to market, across multiple territories, and executed on the marketing plan to raise the brand profile which has provided fresh momentum, stimulating a growing opportunity pipeline and a number of initial contract wins with key target customers.

“Alongside increased order-flow and strengthened customer forecasts there are signs of pent-up demand in our served markets that we are positioning ourselves to capitalise on.

“The recent refresh of our strategic plan identified key objectives, milestones and the required advancement of our technology roadmap to further develop the business which we look forward to executing on over the coming year.”

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