Annual Financial Report

RNS Number : 5279J

Spirent Communications PLC

31 March 2010

 



SPIRENT COMMUNICATIONS PLC

ANNUAL REPORT 2009 AND ASSOCIATED DOCUMENTS

London, UK - 31 March 2010 - Spirent Communications plc (the "Company") (LSE: SPT), a leading communications technology company, announces that its Annual General Meeting will be held on Wednesday 5 May 2010 at 10.30am at Holborn Gate, 26 Southampton Buildings, London WC2A 1PB.

In connection with this, the following documents have been posted or made available to shareholders today:

·     Annual Report 2009

·     Notice of 2010 Annual General Meeting

·     Form of Proxy for 2010 AGM

These documents have also been submitted to the UK Listing Authority, and will shortly be available for inspection at:

Financial Services Authority

25 The North Colonnade

Canary Wharf

London

E14 5HS

The Annual Report 2009 and Notice of 2010 Annual General Meeting are also available in the Investors section of the Spirent Communications plc website at www.spirent.com.

A condensed set of the financial statements for the year ended 31 December 2009 together with information on important events that occurred during that financial year and their impact on the financial statements were contained in the Preliminary Results announcement made on 4 March 2010.  That information, together with the information set out in the appendices to this announcement, which is extracted from the Annual Report, constitute the material required by Disclosure & Transparency Rule 6.3.5 which is required to be communicated to the media in full unedited text through a Regulatory Information Service.  This announcement is not a substitute for reading the Annual Report.

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Enquiries

Rachel Whiting Company Secretary

Spirent Communications plc

[phone]

About Spirent Communications plc

Spirent Communications plc is a global leader in test and measurement inspiring innovation within development labs, communication networks and IT organisations.  We enable today's communication ecosystem as well as tomorrow's emerging enterprises to deploy life-enriching communications networks, devices, services and applications.  The Systems group develops power control systems for electrical vehicles in the mobility and industrial markets.  Further information about Spirent Communications plc can be found at www.spirent.com.

Spirent Communications plc Ordinary shares are traded on the London Stock Exchange (ticker: SPT).  The Company operates a Level 1 American Depositary Receipt ("ADR") programme with each ADR representing four Spirent Communications plc Ordinary shares.  The ADRs trade in the US over-the-counter market under the symbol SPMYY and the CUSIP number is 84856M209.

Spirent and the Spirent logo are trademarks or registered trademarks of Spirent Communications plc.  All other trademarks or registered trademarks mentioned herein are held by their respective companies.  All rights reserved.

This document may contain forward-looking statements which are made in good faith and are based on current expectations or beliefs, as well as assumptions about future events.  You can sometimes, but not always, identify these statements by the use of a date in the future or such words as "will", "anticipate", "estimate", "expect", "project", "intend", "plan", "should", "may", "assume" and other similar words.  By their nature, forward-looking statements are inherently predictive and speculative and involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future.  You should not place undue reliance on these forward-looking statements, which are not a guarantee of future performance and are subject to factors that could cause our actual results to differ materially from those expressed or implied by these statements.  The Company undertakes no obligation to update any forward-looking statements contained in those document, whether as a result of new information, future events or otherwise.

Appendices

Appendix A: Responsibility statement

The Annual Report and consolidated financial statements are the responsibility of, and have been approved by, the directors.

Each of the directors confirms that, to the best of his knowledge:

•           the consolidated financial statements of the Group and parent Company financial statements, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and the profit or loss of the Company and the undertakings included in the consolidation taken as a whole; and

•           the Annual Report includes a fair review of the development and performance of the business and the position of the Company and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.

By Order of the Board

Eric Hutchinson

Chief Financial Officer

4 March 2010

Appendix B: Related party transactions

Remuneration of key management personnel

The remuneration of the directors, who are the key management personnel of the Group, is disclosed in the Report on directors' remuneration.

There were no other material related party transactions during the year ended 31 December 2009.

Appendix C: Our principal risks and uncertainties

We conduct regular risk reviews to identify the major risks in the business which may affect our operating and financial performance and where possible put in place mechanisms to mitigate them. Significant risks are reviewed by the Board and the Audit Committee. It is not possible to identify every risk that could affect the business, and the actions described below to mitigate those risks cannot provide absolute assurance that the risk will not occur and/or adversely affect the operating or financial performance of the Group. These processes are more fully described in the Directors' statement on corporate governance.

The principal risks and uncertainties which the directors believe are currently faced by Spirent Communications plc are discussed below.

Risk and potential impact	Mitigation actions
Macro economic and industry sector
In common with most businesses Spirent is exposed to the current economic conditions. We are particularly exposed to conditions in the telecommunications sector into which we sell many of our products and services.	Having the ability to adapt to changing market dynamics is key in order to minimise the effects of adverse economic or sector conditions. Our businesses closely monitor both market and geographic trends so that we are in a position to take timely actions to protect profitability where possible.
Technological change
As Spirent sell solutions in industries that are characterised by rapid technological changes, keeping at the forefront of these technologies is critical to our success and in ensuring that we remain competitive in our markets. Bringing these new solutions to market at the right time for our customers is also key to our success as well as ensuring that our solutions portfolio is aligned with their needs.	We continue to make significant investment in product development and in 2009 £47.5 million, being 17.5 per cent of revenue, was invested. We work closely with customers and remain focused on their requirements and believe we are investing in areas that represent their future. Our value proposition is based on our service, expertise and product breadth.
Reliance on contract manufacturers
We use contract manufacturers for the manufacture of a substantial amount of our products. Disruption or financial problems of contract manufacturers or limitations in the manufacturing capacity at contract manufacturers could either limit supply or increase our costs.	We work closely with our contract manufacturers and maintain a regular on-site presence. To minimise the effect on supply that could be caused by disruption at contract manufacturers there are contingency plans in place to transfer manufacturing to other locations.
Business continuity risks
Operational risks are present in the Group's businesses. These risks include the risk of failed internal and external processes and systems, human error and external events, such as a natural disaster. For example a significant portion of our communications operations are located in California which has in the past experienced natural disasters, including earthquakes and wildfires.	An important component of Spirent's corporate governance is its integrated risk management strategy and its regular self assessment of risks encompassing all business units. Part of this process is to ensure that the risks of disruption to the business are identified, monitored and controlled wherever possible as well as arranging appropriate insurance cover.

Retention and recruitment of key staff
Spirent is its employees. So attracting and retaining highly qualified and skilled employees is essential in enabling us to deliver on our strategy and to the success of our business.	We aim to find, keep and engage the highest calibre of employees and encourage their contribution and development. An environment that fosters innovation and collaboration is critical to Spirent's success. Appropriate career paths and internal recognition programmes are developed for both technical and non-technical staff.
Intellectual property
Spirent's success is dependent in part on proprietary technology which may be infringed by others inadvertently or otherwise. We may inadvertently infringe the intellectual property rights of third parties.	We have active intellectual property protection programmes in place to obtain appropriate intellectual property protection in a cost effective manner. There are procedures in the development of new products that include consideration of intellectual property rights of third parties. We also consult internal and external legal counsel experienced in intellectual property matters.
Exchange rate
Spirent conducts operations globally and accordingly the value of revenue and expenses, assets and liabilities will be affected by fluctuations of the pound sterling, the reporting currency, against the currency in which these are denominated. The principal currency to which we are exposed is the US dollar. Currency exposures also arise from trading transactions undertaken by the Group's operations in foreign currencies.	The Group does not enter into instruments to hedge the translation exposure of the operating results or net assets of its overseas subsidiaries as these are considered accounting and not cash exposures. Where currency exposures on trading do not naturally offset, forward foreign currency exchange contracts are put in place by Group treasury to hedge the transactions.

 

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