REG - Solid State PLC - Trading Update

Solid StateAnnouncement

21/04/2022 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20220421:nRSU8142Ia&default-theme=true

RNS Number : 8142I  Solid State PLC  21 April 2022

 

Solid State plc

("Solid State", the "Group" or the "Company")

Trading Update

 

Solid State plc (AIM: SOLI), the specialist value added component supplier and
design-in manufacturer of computing, power, and communications products,
announces a trading update for the 12 months ended 31 March 2022 (the "Period"
or "FY22").

Following an exceptionally strong finish to the Period, the Company expects to
announce record results with revenues for FY22 of approximately £85m (2021:
£66.3m) up 28% over the prior year, and adjusted profit before tax for the
Period of approximately £7.2m (2021: £5.4m) up 33%; both ahead of recently
upgraded consensus expectations(1).  The like for like open orderbook at 31
March 2022 is up 106% over the prior year at a record £85.5m (31 March 2021:
£41.5m).

These results reflect a strong performance across the Group, with notable
contributions in electro-mechanical and imaging systems resulting from the
acquisition of Willow Technologies and Active Silicon respectively. Both these
companies have performed ahead of management's expectations since their
acquisition in March 2021.

Like for like organic revenue growth is in excess of 8%, which is pleasing
given the well publicised supply chain and macro-economic challenges faced in
the year and the more recent conflict in Ukraine which, to date, has had
negligible impact.

The Group has enjoyed particularly strong demand in the energy and aerospace
& defence sectors, with the latter now representing approximately 15% of
the Group's revenue.  Contracts awarded in Q4 of the Period by BAE Systems
for marine platforms, and a Component solutions contract for smart meters in
India for CyanConnode, illustrate the breadth of the customer base and
applications secured.

As Solid State executes on its growth strategy, its favoured approach to
business development and the increased scale of the Group is allowing it to
compete for, and win, previously inaccessible high value contracts as
customers engage across a broader product and service offering.

As previously reported, Solid State has navigated the long-term supply chain
challenges associated with semiconductor shortages through careful inventory
management and pro-active engagement with customers to manage order
scheduling.  Given the success of this experience, the Group is taking a
similar approach to the management of input cost pressures and inflationary
effects of recent global events, continuing to manage the ongoing supply
challenges and help mitigate potential margin erosion risks. This is enabling
the Group to share the risk with its customers and pass on some of the cost
increases.

The Group's continued strong cash generation has enabled it to invest
significantly in inventory to support its customers in managing and mitigating
the supply chain challenges the industry has faced, and continues to face, as
we enter FY23.

The Board, being mindful of the geo-political influences on both domestic and
international business and acknowledging the ongoing challenges of COVID-19 in
the Period, considers the Group's performance for the Period to be a great
credit to the staff and the business as a whole.

Solid State continues to deliver on its organic growth strategy through the
targeting of structural growth markets and remains focused on complementary
acquisition opportunities. The record open order book and trading momentum
underpin the near-term prospects and give the Directors optimism for the
future.

 

(1) Analysts from brokers WH Ireland Limited, finnCap Limited, and Edison
Investment Research Limited, provide equity research on Solid State, and the
Company considers the average of their research forecasts to represent market
expectations, being, for Solid State's 2021/22 financial year, revenue of
£80m, and adjusted profit before tax* of £6.5m.

* The adjustments relate to IFRS 3 acquisition amortisation, share based
payments charges, and non-recurring charges in respect of redundancies and
acquisition costs and fair value adjustments

This announcement contains inside information for the purposes of Article 7 of
the UK version of Regulation (EU) No 596/2014 which is part of UK law by
virtue of the European Union (Withdrawal) Act 2018, as amended ("MAR"). Upon
the publication of this announcement via a Regulatory Information Service,
this inside information is now considered to be in the public domain.

 

For further information please contact:

 

 Solid State plc                                           Via Walbrook

 Gary Marsh - Chief Executive

 Peter James - Group Finance Director
 WH Ireland (Nominated Adviser & Joint Broker)             020 7220 1666

 Mike Coe / Sarah Mather (Corporate Finance)

 Fraser Marshall (Sales)

 finnCap (Joint Broker)                                    020 7220 0500

 Ed Frisby (Corporate Finance)

 Rhys Williams / Tim Redfern (Sales / ECM)
 Walbrook PR (Financial PR)                                020 7933 8780

 Tom Cooper / Nick Rome                                    0797 122 1972

                                                           solidstate@walbrookpr.com (mailto:solidstate@walbrookpr.com)

 

 

Analyst Research Reports: For further analyst information and research see the
Solid State plc website: https://solidstateplc.com/research/
(https://urldefense.proofpoint.com/v2/url?u=https-3A__solidstateplc.com_research_&d=DwMFAg&c=euGZstcaTDllvimEN8b7jXrwqOf-v5A_CdpgnVfiiMM&r=05PHl3GHdShYuaCii2fBRpoqaNr9B1d97X09daeosu0&m=JmX-gQVke87P3UDBxQzNglNm9FfzH5yZtIa_SmElSS4&s=ib8r3ul2tCaEvJ39SnR1LT7nCa7gAcRQzgO-kNoyZoM&e=)

 

Notes to Editors:

Solid State plc (SOLI) is a value added electronics group supplying
commercial, industrial and military markets with durable components,
assemblies and manufactured units for use in specialist and harsh
environments.  The Group's mantra is - 'Trusted technology for demanding
applications'.  To see an introductory video on the Group
- https://bit.ly/3kzddx7 (https://bit.ly/3kzddx7)

 

Operating through two main divisions: Systems (Steatite & Active Silicon)
and Components (Solid State Supplies, Pacer, Willow Technologies & AEC);
the Group specialises in complex engineering challenges often requiring
design-in support and component sourcing for computing, power, communications,
electronic, electro-mechanical and opto-electronic products.

 

Headquartered in Redditch, UK, Solid State employs approximately 300 staff
across UK and US, serving specialist markets in industrial, defence and
security, transportation, medical and energy.

 

Solid State was established in 1971 and admitted to AIM in June 1996.  The
Group has grown organically and by acquisition - having made 12 acquisitions
since 2002.

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTEAXLEAEXAEFA