REG - Gooch & Housego PLC - Half Year Trading Update

Gooch & HousegoAnnouncement

08/04/2025 07:00

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RNS Number : 9960D  Gooch & Housego PLC  08 April 2025

 

 For immediate release  8 April 2025

 

Gooch & Housego PLC

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

 

Half Year Trading Update
and
Notice of Results

 

"Trading in line with management's expectations"

 

Gooch & Housego PLC (AIM: GHH), the specialist manufacturer of photonic
components and systems, provides an update on trading for the six months ended
31 March 2025.

 

Trading

 

Revenue for the six-month period was £70.8 million (31 March 2024: £63.6
million), an increase of 7.5% on an organic, constant currency basis. Demand
from the Group's Aerospace & Defence and Life Sciences markets has been
strong and revenues from the Group's fibre optic products used in subsea data
cable networks also grew whilst activity levels in the Group's industrial
laser and semiconductor markets remains subdued.

 

During the six-month period, the Group's order book increased to £121.5
million (30 September 2024: £104.5 million) with the acquired Phoenix Optical
business bringing approximately £7 million of this increase. The increase on
an organic constant currency basis was 4%. The level of enquiries for the
Group's products and services remains high, especially from both existing and
new defence equipment customers, supported by the broader capability and
capacity now available to the Group as a result of the acquisition of the
Phoenix business. The order book provides good coverage for our expected
second half revenues.

 

The integration of the Phoenix Optical business is proceeding to plan. This
acquisition has already allowed the Group to secure new customer orders as a
result of our newly combined capabilities. We are also seeing the benefits of
the planned operational synergies due to the combined facility capacity
planning between Phoenix and the Group's other precision optics sites.

 

The Group is seeking to navigate the rapidly evolving tariff arrangements
being implemented by the US administration together with the consequent actual
or potential retaliatory actions of other nations, although it is too early to
be definitive on the net impact to the Group. The Group's direct exposure to
those countries that have been subjected to the most significant tariff
increases on imports to the US is limited, but we remain vigilant to the more
general inflationary impacts of increasing global tariffs and possible
indirect effects. We are also actively re-sourcing our supply of certain raw
materials required in our production processes where availability has been
restricted by some nations retaliating against the newly imposed tariffs. We
intend to pass on cost base increases arising from these developments through
higher pricing. Given the Group's considerable US-based manufacturing presence
the new tariffs could over time be a benefit to some parts of our business
against their non-US competitors.

 

The Group remains in a strong financial position with a robust balance sheet.
On 1 April 2025 the Group extended its debt facility for a further three years
to 2030 and secured additional committed facilities.  As at 31 March 2025 net
debt excluding lease liabilities was £24.1 million (March 2024: £22.2
million and September 2024: £16.0 million) and the Group had $31.6 million
available to draw upon to fund its future growth activities.

 

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

 

Strategic progress

 

The Group continues to execute on its strategic plan. The investments that
have been made in our Operations and Supply Chain teams are bearing fruit.
Production yields are trending positively and we are accelerating the transfer
of carefully selected product lines to our contract manufacturing partners in
lower cost regions.

 

We are starting to realise the benefits from our newly established medical
diagnostic design, development and production facility based in our Rochester
NY site. We have secured some important new customer contracts and the
facility is now in volume production for two medical diagnostic instrument
programmes.

 

Notice of Results

 

The Group will announce its interim results for the six months ended 31 March
2025 on 3 June 2025.

 

 

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

 

"I am pleased with the progression of the Group's order book in the period,
which demonstrates the growing confidence our customers have in G&H to
provide them with their most complex photonic systems needs.

 

Our production facilities are starting to benefit from the operational
efficiency improvements that are an important part of the Group's strategic
plan. Output levels are increasing and production yields are improving. At the
same time, our outsourcing plans are accelerating with additional product
qualifications. These actions will provide the group with additional
productive capacity to service growing levels of demand whilst also supporting
margin accretion.

 

Whilst there remains significant uncertainty in our Industrial markets we are
confident that growing demand from the Group's other markets will allow us to
make further progress in the balance of the financial year on our journey to
mid-teens returns over the medium term."

 

 

 

For further information please contact:

 

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

 Chris Jewell, Chief Financial Officer

 Mark Court / Sophie Wills / Abigail Gilchrist              Burson 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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