Interim Management Statement
Spirent Communications PLC
08 May 2008
SPIRENT COMMUNICATIONS PLC
INTERIM MANAGEMENT STATEMENT (UNAUDITED)
London, UK - 8 May 2008: Spirent Communications plc ("Spirent", the "Company" or
the "Group") (LSE: SPT), a leading communications technology company, announces
the following unaudited Interim Management Statement for the period since 31
December 2007.
Trading performance for the period since 31 December 2007 is in line with the
Board's expectations.
The results for the first quarter of 2008 are set forth below:
Continuing operations
£ million 1st quarter 1st quarter
2008 2007
Revenue 59.0 54.4
Operating profit/(loss) 9.6 (0.6)
Earnings per share (basic) - pence 1.22 0.07
Earnings from continuing operations include a charge in both quarterly periods
of 0.08 pence per share for share-based payment and amortisation of intangible
assets.
Performance Analysis
Revenue for the division, expressed in US dollars, was $85.5 million in the
first quarter of 2008 compared with $73.3 million for the first quarter of 2007,
an increase of 17 per cent. The increase reflects, in part, a comparison with
lower than usual sales in the first quarter of last year and the Company
continues to budget for sales growth for 2008 as a whole in the mid single digit
range. Orders in April have been satisfactory and the division continues to
maintain a substantial order book.
Service Assurance
Service Assurance saw two per cent growth in revenues in US dollars and
generated an improved operating profit performance through a combination of a
higher gross profit margin, due to an increased element of software revenue in
the quarter, and reduced overhead expense.
Systems
Systems' revenue decreased as a result of exchange impact and lower volumes.
Profitability was maintained through cost control. A recovery in sales volume
has been made in April.
Profitability
The improvements in gross profit margin and overall profitability of the Group
reflect the realisation of benefits from the restructuring implemented in 2007.
Cash
The closing cash position was £66.7 million at 4 May 2008 (31 December 2007:
£79.0 million) after an outflow of £22.5 million in the period for the share
repurchase programme.
Outlook
We anticipate that trading performance for the year will continue to be in line
with our expectations.
Edward Bramson, Chairman, commented:
"Spirent has continued to benefit from last year's operational restructuring and
April orders have given an encouraging start to the second quarter. We are also
making good progress in new product development to address the opportunities
created for us by continual evolution in broadband and wireless technologies."
- ends -
Enquiries
Edward Bramson, Executive Chairman Spirent Communications plc +44 (0)1293 767676
Eric Hutchinson, Chief Financial Officer
Andrew Dowler/Harriet Keen Financial Dynamics +44 (0)20 7831 3113
The Company's AGM is being held today at 10.30am UK time at the offices of the
Company's PR Advisers, Financial Dynamics, Holborn Gate, 26 Southampton
Buildings, London.
The interim half year results for 2008 will be announced on Thursday 7 August
2008.
About Spirent Communications plc
Spirent Communications plc is a leading communications technology company
focused on delivering innovative systems and services to meet the needs of
customers worldwide. We are a global provider of performance analysis and
service assurance solutions that enable the development and deployment of
next-generation networking technologies such as broadband services, Internet
telephony, wireless and web applications and security testing. The Systems
group develops power control systems for specialist 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 ("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 www.pinksheets.com.
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 this document,
whether as a result of new information, future events or otherwise.
Consolidated income statement (unaudited)
Quarter ended 30 March 2008
1st quarter 2008 1st quarter 2007
£ million £ million
Continuing operations
Revenue 59.0 54.4
Cost of sales (21.5) (22.2)
Gross profit 37.5 32.2
Product development (10.5) (11.5)
Selling and distribution (10.9) (13.2)
Administration (6.5) (8.1)
Operating profit/(loss) 9.6 (0.6)
Net finance income 0.9 1.3
Profit/(loss) before tax 10.5 0.7
Tax (1.1) (0.1)
Profit/(loss) for the period from continuing operations 9.4 0.6
after tax
Discontinued operations
Loss for the period from discontinued operations - (1.5)
Profit/(loss) for the period attributable to equity 9.4 (0.9)
holders of parent
Earnings/(loss) per share (pence)
Basic and diluted 1.22 (0.10)
Basic and diluted from continuing operations 1.22 0.07
Segmental analysis - continuing operations
1st quarter 2008 1st quarter 2007
£ million £ million
Revenue
Performance Analysis 43.2 37.7
Service Assurance 8.3 8.3
Communications 51.5 46.0
Systems 7.5 8.4
59.0 54.4
Operating profit/(loss)
Performance Analysis 7.9 0.1
Service Assurance 1.7 (0.1)
Communications 9.6 -
Systems 0.7 0.8
Non-segmental (0.7) (1.4)
9.6 (0.6)
Other information
Depreciation 2.2 2.8
Capital expenditure 1.9 1.5
Share-based payment 0.4 0.5
Intangible amortisation 0.2 0.2
Appendix
Spirent Communications plc
Consolidated income statement by quarter (unaudited)
£ million 2007 2008
Q1 Q2 Q3 Q4 Q1
Continuing operations
Revenue 54.4 59.8 59.2 63.6 59.0
Cost of sales (22.2) (26.0) (21.9) (21.5) (21.5)
Gross profit 32.2 33.8 37.3 42.1 37.5
Product development (11.5) (11.3) (10.2) (11.5) (10.5)
Selling and distribution (13.2) (12.4) (10.7) (10.8) (10.9)
Administration (8.1) (17.1) (7.5) (10.0) (6.5)
Operating profit/(loss) (0.6) (7.0) 8.9 9.8 9.6
Exceptional items - 12.6 - 1.8 -
Operating profit/(loss) before exceptional items (0.6) 5.6 8.9 11.6 9.6
Net finance income 1.3 1.8 1.6 2.0 0.9
Profit/(loss) before tax 0.7 (5.2) 10.5 11.8 10.5
Tax (0.1) (0.6) (1.2) 9.6 (1.1)
Profit/(loss) from continuing operations after 0.6 (5.8) 9.3 21.4 9.4
tax
Discontinued operations
Profit/(loss) from discontinued operations (1.5) (6.8) - 0.4 -
Profit/(loss) for the quarter (0.9) (12.6) 9.3 21.8 9.4
Earnings/(loss) per share (pence) - continuing
operations
Basic 0.07 (0.67) 1.06 2.51 1.22
Adjusted basic 0.07 0.78 1.06 1.66 1.22
Diluted 0.07 (0.67) 1.06 2.48 1.22
Weighted average number of shares in issue at 875.0 873.7 873.6 859.8 768.7
period end - basic (million)
Weighted average number of shares in issue at 880.3 884.2 880.7 868.6 770.2
period end - diluted (million)
Adjusted earnings from continuing operations
Profit/(loss) from continuing operations after 0.6 (5.8) 9.3 21.4 9.4
tax
Exceptional items - 12.6 - 1.8 -
Tax on exceptional items - - - (3.9) -
Prior year tax credit - - - (5.3) -
0.6 6.8 9.3 14.0 9.4
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