First Quarter Trading Update 2017

RNS Number : 9746D

Spirent Communications PLC

03 May 2017

 

SPIRENT COMMUNICATIONS PLC

First Quarter Trading Update 2017

London, UK - 3 May 2017: Spirent Communications plc ("Spirent", the "Company" or the "Group") (LSE: SPT), a leading communications technology company, today issues the following trading update for the period from 1 January to 31 March 2017.

Group performance

The year has started well with the first quarter trading ahead of the same period last year.  Revenue was up 4 per cent to $106.4 million and profit up $5.8 million to $7.6 million.

Order intake was broadly level in the quarter compared to the same period last year and reflects the usual seasonality of the business.  Ongoing trends of strong demand for Networks & Security testing offset the continuing decline of Connected Devices testing for smartphones in particular.  Book to bill ratio for the quarter was 85 (2016: 89).

Results

The results for the first quarter are set out below:

$ million	1st quarter 2017	1st quarter 2016
Order intake	90.2	91.3
Revenue	106.4	102.7
Adjusted operating profit1	7.6	1.8
Free cash flow2	19.5	16.2

Notes

1 Adjusted operating profit is before charging exceptional items, acquisition related costs, acquired intangible asset amortisation and impairment, goodwill impairment and share-based payment.

2 Operating cash flow after tax, net interest and net capital expenditure.

Networks & Security

A strong performance in the period, with revenue up 23 per cent to $64.3 million.  Demand for high-speed Ethernet products launched last year continues and momentum is also gathering for our new cyber security offerings.

Lifecycle Service Assurance

Revenue in the first quarter of $22.5 million, compared to $26.2 million in the same period last year.  A key focus in the early part of this year is integrating our products and services to deliver automated active test analytics.  The pipeline for customer assurance requirements is promising for second half order intake.

Connected Devices

Revenue in the period was $19.6 million compared to $24.1 million in the first quarter of 2016, reflecting the ongoing reduction in smartphone testing.

Free cash flow in the first quarter of 2017 was $19.5 million compared to $16.2 million in the same period last year.  The balance sheet remains strong, with cash of $115.8 million, up from $96.1 million at 31 December 2016.

Commenting on the results, Eric Hutchinson, Chief Executive Officer, said:

"I am pleased with the positive start to the year underpinned by strong growth in Networks & Security.  We continue to focus on leading edge technologies supporting our chosen portfolio of initiatives whilst carefully responding to market trends in our Connected Devices segment.  The strong start and ongoing demand for our core products and services gives us confidence for further growth in 2017 and our expectations for the year remain unchanged."

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Enquiries

Eric Hutchinson, Chief Executive Officer		Spirent Communications plc		[phone]
Paula Bell, Chief Financial Officer
James Melville-Ross/Emma Appleton		FTI Consulting		[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.  Further information about Spirent Communications plc can be found at http://corporate.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 ("OTC") market under the symbol SPMYY and the CUSIP number is 84856M209.  Spirent ADRs are quoted on the Pink OTC Markets electronic quotation service which can be found at http://www.otcmarkets.com/marketplaces/otc-pink.

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.

Cautionary statement regarding forward-looking statements

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 this document, whether as a result of new information, future events or otherwise.

 

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