Stadium Group PLC Trading Update & Notice of Results (8522V)

TIDMSDM

RNS Number : 8522V

Stadium Group PLC

08 November 2017

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 (MAR).

Stadium Group plc

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

Trading Update & Notice of Results

Stadium Group plc (AIM: SDM), a leading supplier of design-led technologies including connectivity solutions, power supplies, human machine interface products and electronic assemblies, provides the following trading update.

Significant progress continues to be made in transitioning Stadium from a purely electronic assemblies business to a design-led technology business. The Company expects to report a year-on-year increase in revenues of 15% to GBP61m (2016: GBP53.1m).

Whilst revenue growth and the development of the forward order book are in-line with expectations for the current year, the Board now expects single digit percentage growth in normalised profit before tax, which is below current market expectations. This is primarily due to customer delays into 2018 for certain higher margin Technology Products projects, which had originally been expected to ship before the year end.

The widely reported global shortage of certain electronic components, particularly memory, integrated circuitry and passive components, has compounded the situation. As reported at the time of the interim results, this has also contributed to cost pressures and, despite building inventory, it has not proved possible to fully mitigate this. Actions have been taken to off-set some of the revenue short-fall by undertaking additional Electronic Assembly sales, but the lower margin nature of this work will only partially alleviate this impact. The delayed sales and increased inventory referred to above are expected to result in increased net debt at 31 December 2017.

The Company's offering of complementary electronics technologies and specialist design-focused engineering expertise continues to be attractive to its customers and the growing demand seen in the first half of the year is evidenced by the continued growth in its order book, which currently exceeds GBP32m, a new record level for the Group (up from GBP25.8m at 31 December 2016). Although the Board recognises that the delays and some pricing pressure will continue to impact the Group in 2018, the forward visibility provided by the order book and the strong design pipeline of newly awarded projects, provides confidence that the Company will deliver double-digit revenue and profit before tax growth in the coming year.

Stadium will announce its financial results for the year ended 31 December 2017 on Tuesday, 13 March 2018.

*Normalised profits referred to in this announcement are stated before costs relating to acquisitions and disposals, business restructuring costs, profit/(loss) on disposal of businesses, items deemed to be of an exceptional nature, impairment of goodwill and acquired intangibles.

For further information please contact:

 
Stadium Group plc                            www.stadiuminvestors.com 
Charlie Peppiatt, Chief                            Tel: [phone] 
 Executive Officer 
Winston North, Group                               Mob: [phone] 
 Finance Director 
 
Walbrook PR              Tel: [phone] or [e-mail] 
Paul McManus                                       Mob: [phone] 
Helen Cresswell                                    Mob: [phone] 
 
N+1 Singer 
Richard Lindley                                    Tel: [phone] 
 

About Stadium Group plc (www.stadiumgroupplc.com)

Stadium Group plc is a leading supplier of design-led technologies including connectivity solutions, power supplies, human machine interface (HMI) and electronic assemblies with design and manufacturing operations in the UK, Sweden and Asia. The Company consists of two divisions:

   1.    Technology Products (60% of 2016 revenues) 

-- Connectivity solutions - design, integration and manufacture of machine-to-machine ("M2M") and Internet of Things ("IoT") wireless solutions

   --     Power supplies (including Stontronics) - custom and standard power products from 1W to 10kW 
   --     Human machine interface (HMI) - intelligent interface and display solutions 
   2.    Electronic Assemblies (40% of 2016 revenues) 
   --     Electronic manufacturing services to global original equipment manufacturers 

This information is provided by RNS

The company news service from the London Stock Exchange

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November 08, 2017 02:00 ET (07:00 GMT)