REG - Gooch & Housego PLC - Half Year Trading Update

Gooch & HousegoAnnouncement

04/04/2023 07:00

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RNS Number : 2222V  Gooch & Housego PLC  04 April 2023

 

 For immediate release  4 April 2023

 

Gooch & Housego PLC

("G&H" or the "Company" or the "Group")

 

Half Year Trading Update

 

"Trading in line with management's expectations"

 

Gooch & Housego PLC (AIM: GHH), the specialist manufacturer of photonic
components & systems, provides an update on trading for the six months
ended 31 March 2023.

 

Trading

 

In the first half of the financial year the Group made good progress in adding
additional capacity to our production facilities. Output levels have increased
and we have made steady progress in reducing the level of our overdue order
book.

 

Revenue for the six month period is expected to be circa £71.0 million (31
March 2022: £54.1 million) supported by favourable exchange rate movements
and the effects of price increases to offset cost input inflation. As
previously reported, the progress we have made with recruitment and the supply
chain actions we have taken, mean we expect trading this year to be more
evenly weighted between the two halves of the financial year than in prior
years.

 

New orders for the Group's products from our semiconductor, data
communications and next generation industrial laser markets have continued to
be strong.  We have secured important new programme positions with medical
diagnostic customers which will replace other programmes that are now coming
to the end of their life cycle. Requests for quotations for the replenishment
of equipment that has been deployed into Ukraine are accelerating and we
anticipate some of these will convert to new orders shortly. As previously
communicated, whilst there is evidence that some of the Group's customers in
certain industrial and medical laser sub markets are overstocked we expect
this position to rectify itself in the second half of the financial year due
to underlying end market demand.

 

As at 31 March 2023 our order book stood at £124.4 million (31 March 2022:
£119.9 million), an increase of 3.8%, or a reduction of 0.1% at constant
currency, compared with the same time last year. This order book provides good
coverage for our expected second half revenues.

 

The Group continues to experience high input cost inflation. In order to
ensure we remain competitive in the employment market we have made further
upward adjustments to salary levels. We have also seen continued cost
inflation from our supply chain. Our commercial team remain focused on passing
on these higher costs through pricing and this will support the Group's
performance in the second half of this financial year.

 

We remain in a strong financial position with a robust balance sheet and low
net debt. At the half year net debt was circa £19m and the Group had $46.2m
available from existing committed and uncommitted debt facilities to fund its
future growth activities.

 

We expect trading for the full year to be in line with management's previously
reported expectations.

 

 

 

 

Review of the Group's strategy and interim results date

 

The review of the Group's strategy is progressing according to plan. Initial
findings have been shared with the Board and we expect to provide more
information when the Group's interim results for the six months ended 31 March
2023 are announced on 6 June 2023.

 

 

Charlie Peppiatt, Chief Executive Officer of Gooch & Housego, commented:

 

"I am pleased with the progress that has been made in the first half of the
financial year with  increasing operational output to better address the
demand for our products as well as continued positive levels of customer
engagement on next generation programmes and new product opportunities in all
our main end markets.  This is thanks to the hard work of our employees
across the Group and means we are well placed to meet management's
expectations for the full year.

 

 "We are on track with our review of the Group strategy and expect to be able
to provide more information along with the interim results in June 2023."

 

 

For further information please contact:

 

 Charlie Peppiatt, Chief Executive Officer                  Gooch & Housego PLC      +44 (0) 1460 256440

 Chris Jewell, Chief Financial Officer

 Mark Court / George Cleary                                 Buchanan                 +44 (0) 20 7466 5000

 G&H@buchanan.uk.com (mailto:G&H@buchanan.uk.com)

 Christopher Baird / David Anderson                         Investec Bank plc        +44 (0) 20 7597 5970

 

 

Notes to editors

 

1.     Gooch & Housego is a photonics technology business
headquartered in Ilminster, Somerset, UK with operations in the USA and
Europe. A world leader in its field, the company researches, designs,
engineers and manufactures advanced photonic systems, components and
instrumentation for applications in the Aerospace & Defence, Industrial,
Life Sciences and Scientific Research sectors. World leading design,
development and manufacturing expertise is offered across a broad range of
complementary technologies.

 

2.     All financial information included in this announcement is sourced
from unaudited management accounts and excludes any specific items. This
announcement contains certain forward-looking statements that are based on
management's current expectations or beliefs as well as assumptions about
future events.  These are subject to risk factors associated with, amongst
other things, the economic and business circumstances occurring from time to
time in the countries and sectors in which G&H operates.  It is believed
that the expectations reflected in these statements are reasonable but they
may be affected by a wide range of variables which could cause actual results,
and G&H's plans and objectives, to differ materially from those currently
anticipated or implied in the forward-looking statements.  Investors should
not place undue reliance on any such statements. Nothing in this announcement
should be construed as a profit forecast.

 

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