Half Year Trading Update

RNS Number : 9434T

Carclo plc

10 October 2014

 



                                                                                                                        10 October 2014

Carclo plc

("the group")

Half year trading update

The board is pleased to announce that the group has traded in line with its expectations for the first half of the financial year.  The board also announces that it has commenced a full strategic review of the CIT Technology ("CIT") business.

In Technical Plastics, profits will be well ahead of last year's comparative period.  Our expanded US and Czech facilities are now fully operational and production has ceased at our Harthill facility in Scotland.  We have been awarded a further multi-year program for medical component manufacture for China from an existing customer and as a result we are moving to a new facility in Taicang, which is just outside Shanghai. This much larger factory will replace our existing Shanghai operation and provide cleanroom manufacturing capacity to enable the group to expand its medical business in China.

Within LED Technologies profits will also be significantly in excess of last year's comparative period.  Our Wipac supercar business has been awarded four new design wins so far this financial year which will support the strong growth expectations for this business which is increasing capacity at its Buckingham facility.  Our LED Optics operation continues to perform well.

The group's Precision Engineering division will report profits in line with last year's comparative period; however, recently secured new business should lead to growth into the next financial year.

At CIT sales of coated film have tracked expectations.  The higher CIT amortisation charges and the reduced level of capitalised costs in the now commercialised touch business have, as expected, impacted CIT's financial performance in the first half of the year. The board has initiated a full strategic review of the CIT business against a backdrop of lower than expected traction with end customers and continued losses. This review is expected to be completed by our financial year end.  The board believes that it would be prudent to carry out an impairment review of the intangible and tangible assets of the business and this is expected to result in a significant write down at the half year end.

Progress at Carclo Diagnostics Solutions has been consistent with the Development Plan set out in the 2014 Report and Accounts and we will provide further details on this in our interim results announcement.

The Board continues to believe that the group's underlying profit before tax will be in line with its full year expectations. As in previous years, a greater proportion of the group's operating profits will be generated in the second half of the financial year.  The continuing growth prospects in both Technical Plastics and LED Technologies support the board's positive outlook for the group.  The financial position remains comfortable and it should be noted that any CIT write down would have no impact on the group's ability to meet its banking covenants.

The group will issue its interim results for the period to 30 September 2014 on 18 November 2014.

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Enquiries:
Carclo plc	01924 268040
Chris Malley, Chief Executive
Robert Brooksbank, Finance Director
Weber Shandwick Financial	020 7067 0000
Nick Oborne

 

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