2009 First Half Trading Updat

RNS Number : 7419V

Spectris PLC

16 July 2009

 



Thursday 16 July 2009                     

SPECTRIS PLC 

2009 FIRST HALF TRADING UPDATE

Spectris plc, the productivity-enhancing instrumentation and controls company, today issues a trading update for the six months ending 30 June 2009, ahead of its half year results announcement due to be released on 25 August 2009. 

As previously indicated, the company has experienced challenging market conditions during the first half of the year. On a constant currency organic basis, sales are expected to have declined by approximately 20% compared with the comparatively strong first half in 2008. On a reported basis, sales are expected to be up by 4%, including a 7% contribution from acquisitions and beneficial effects from currency of 17%. 

Demand across business segments and major geographical regions continued to be weak, particularly in the automotive and mining sectors. However, research and environment-related areas showed greater resilience. Despite market conditions, gross margins improved on a constant currency organic basis. Restructuring charges, including post-acquisition integration charges, will be around £7 million in the first half, with at least a further £3 million estimated for the second half. Accordingly, our expectation is that operating profit in the first half will be around £20 million, reflecting a combination of the decline in operating profit on the organic revenue shortfall and the restructuring and post-acquisition integration charges incurred in that period.

Our balance sheet and financial position remain strong. Net debt has increased by approximately 10% since the year end, influenced by the acquisition of Lochard in February for an initial consideration equivalent to £19 million, with normal first half outflows offset by strong cash conversion in the period which is expected to exceed 150%, driven by a continued focus on rigorous operating cash flow management. 

After a challenging first half, visibility of customer demand remains limited. However, we expect to see an improving performance in the second half resulting from the benefits of the restructuring and post-acquisition integration actions as well as anticipating some improvement in the level of business. We are confident that the company's long-term fundamentals are robust and we remain in a strong position to take advantage when our markets return to growth.

ENDS

About Spectris

Spectris plc is a leading supplier of productivity-enhancing instrumentation and controls. The company's products and technologies help customers to improve product quality and performance, improve manufacturing processes, reduce downtime and wastage and reduce time to market. Its global customer base spans a diverse range of end user markets. 

Spectris operates across four business segments which reflect the applications and industries it serves: Materials Analysis, Test and Measurement, In-line Instrumentation and Industrial Controls. Headquartered in Egham, Surrey, the company employs approximately 6,000 people, with offices in 29 countries.

For more information, visit www.spectris.com

Contacts:

Spectris plc

John O'Higgins, Chief Executive                   01784 470470

Clive Watson, Group Finance Director

FD

Andrew Lorenz                                            020 7269 7113

Copies of this announcement are available from the company's registered office at Station Road, Egham, Surrey TW20 9NP, and on the company's website at www.spectris.com.

 

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