REG - Calnex Solutions PLC - Trading Update and Notice of Results

Calnex SolutionsAnnouncement

10/10/2023 15:30

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RNS Number : 6739P  Calnex Solutions PLC  10 October 2023

This announcement contains inside information

 

10 October 2023

 

Calnex Solutions plc

("Calnex", the "Company" or the "Group")

 

Trading Update and Notice of Results

 

Calnex Solutions plc (AIM: CLX), a leading provider of test and measurement
solutions for the global telecommunications and cloud computing markets,
provides an update on trading and outlook for the full year to 31 March 2024
("FY24") and beyond.

 

In the first six months of FY24, the Company's order inflow has remained at
the subdued levels experienced at the start of the year, with the precise
timing of future customer orders remaining uncertain.  The cautiously
improving outlook for the sector identified earlier this year has not
developed momentum and the Company is aware that certain customers have
elected to delay projects and associated orders in response to continuing
wider economic uncertainty. These factors have led the Board to conclude that
H2 FY24 will be slower than anticipated.

 

The challenging market conditions mean the Board now anticipates that, whilst
revenues are expected to increase in H2 versus H1, revenues for FY24 will be
in the region of 20-30 per cent below current market expectations, depending
on the timing of orders. No customer orders have been cancelled and all are
expected to be fulfilled once the delays to customer project spending are
relaxed.

 

The Company's balance sheet remains robust, with cash at the end of September
2023 of £13.5 million, following investment in inventory. The cash position
enables the Company to continue to target growth opportunities in its key
sectors and maintain relationships with customers as they plan future
investment in their projects.

 

Calnex's sales pipeline remains strong and the Company's close relationships
with its customers leaves it well positioned to convert the sales pipeline to
orders once spending patterns normalise.

 

The Board is confident in a return to growth in FY25, with Calnex able to
deploy its suite of products to target opportunities in both the Telecoms and
Cloud-computing and related sectors. Costs are closely monitored with
investment in new products subject to stringent assessment.

 

The Company is actively targeting new markets with its expanded product range,
and recently launched, or soon to be launched, enhanced product lines within
existing and new key markets, include:

 

·  Sentry timing product to address the large data centre market.

·  SNE-Ignite and SNE-X products have been designed to prove the performance
of new, real-time cloud-based applications.

·  NE-ONE, Calnex's recently acquired network emulation product, is
targeting defence and government markets.

·  Enhancement to the Paragon platform, through a major new release in H2
FY25 to support leading edge 800Gb/s interface testing.

·  SyncSense, Calnex's newly-developed data centre and telecom network
management timing product, has been well received by customers.

 

These products will enhance penetration in the Company's target markets,
reinforcing the potential for growth in FY25 and beyond.

 

Notice of Results

 

The Company intends to announce unaudited results for the six months ended 30
September 2023 on Tuesday 21 November 2023.

 

Tommy Cook, Chief Executive Officer, and founder of Calnex, said: "Whilst the
telecommunications market outlook is currently challenging, the expansion of
our product portfolio to areas outside of telecommunications and our strong
sales pipeline mean we are confident in a return to growth in FY25.

 

"Looking to the longer-term, the underlying market drivers continue to build,
such as the need to upgrade telecoms infrastructure to deliver the promise of
5G, and to enhance data centre operations to support the demand for cloud
computing and advancements in AI and Virtual Reality technologies. As a
result, our confidence in the long-term prospects for Calnex remains high."

 

 

For more information, please contact:

 

 Calnex Solutions plc                             Via Alma PR
 Tommy Cook, Chief Executive Officer

 Ashleigh Greenan, Chief Financial Officer

 Cavendish Securities plc - NOMAD                 +44 (0)131 220 6939
 Derrick Lee, Peter Lynch

 Alma                                             + 44(0) 20 3405 0213
 Caroline Forde, Hannah Campbell, Joe Pederzolli

 

 

Overview of Calnex

 

Calnex Solutions designs, produces and markets test and measurement
instrumentation and solutions for the telecoms and cloud computing industries.
Calnex's portfolio enables R&D, pre-deployment and in-service testing for
network technologies and networked applications, enabling its customers
to validate the performance of the critical infrastructure associated
with telecoms and cloud computing networks and the applications that run on
it.

 

To date, Calnex has secured and delivered orders in 68 countries across the
world. Customers include BT, China Mobile, NTT, Ericsson, Nokia, Intel,
Qualcomm, IBM and Meta.

 

Founded in 2006, Calnex is headquartered in Linlithgow, Scotland, with
additional locations in Belfast, Northern Ireland, Stevenage, England and
California in the US, supported by sales teams in China and India. Calnex has
a global network of partners, providing a worldwide
distribution capability.

 

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