Trading Update

RNS Number : 3297N

Spirent Communications PLC

20 January 2023

 

SPIRENT COMMUNICATIONS PLC

Trading Update 2022 - Good growth in a difficult environment

London, UK - 20 January 2023 : Spirent Communications plc ("Spirent", the "Company" or the "Group") (LSE: SPT), the leading provider of automated test and assurance solutions for next-generation devices and networks, today issues the following Trading Update for the financial year ended 31 December 2022, noting all financial results are subject to external audit.

Group performance

· 2022 results in line with expectations, good earnings growth

· Strong orderbook built over last 18 months

· Strong balance sheet and cash flow, resilient business model

We are pleased to deliver our full year results for 2022 in line with expectations having successfully navigated global economic challenges, supply chain constraints and increasing cost inflation. Full year revenue grew by 5.5 per cent to $607 million and we expect to deliver an adjusted operating profit¹ slightly ahead of market consensus², showing good earnings growth over 2021.

As previously communicated, global market economic conditions have been impacting some of our customers, resulting in delays to their investment decisions. Whilst we expect customers to remain committed to their development projects overall, evidenced by no cancellations, the Group's performance is now likely to have a heavier than usual weighting to the second half of 2023.

We continued to win important strategic deals and further built our orderbook by 7 per cent during 2022. This performance was achieved following significant orderbook growth in 2021. High-speed Ethernet grew strongly driven by new product releases including new application security products, which offset some customer timing impacts in Lifecycle Service Assurance.

Financial position

We maintained our strong balance sheet and disciplined investment policy. The Group's cash position closed at $210 million supported by our effective working capital management. We remain strongly placed to take advantage of investment opportunities as they arise.

Outlook

We are pleased to have started the new financial year with a strong orderbook. We are well positioned to deliver further strategic and operational progress, with our key business drivers intact, and we continue to invest in our leading technology solutions across our portfolio. Overall, the Group remains well-placed to deliver continued progress in the year ahead, although there will be greater weighting to the second half.

Eric Updyke, Chief Executive Officer, commented:

"Against a challenging market backdrop, we have delivered a good performance, demonstrating the enduring, through-the-cycle strengths of our operating model and service offerings.

Networks are becoming more complex than ever before and as customers seek faster, more reliable, more secure connectivity solutions, the heightened need for automated testing and assurance will require greater support from Spirent.

We expect the Group to continue to progress in 2023, and in spite of the global economic conditions are confident in our mid-term targets with the long-term structural growth drivers for our business continuing to be compelling."

Spirent expects to announce its full year results for the financial year ended 31 December 2022 on Wednesday, 8 March 2023.

Notes

1.  Adjusted operating profit is before acquired intangible asset amortisation, share-based payment and other adjusting items.

2.  Management believes consensus expectations for adjusted operating profit for the year to be $127 million, with a range of expectations of $122 million to $131 million.

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Enquiries

Eric Updyke, Chief Executive Officer		Spirent Communications plc		[phone] E: [e-mail]
Paula Bell, Chief Financial & Operations Officer
James Melville-Ross/James Styles/Humza Vanderman/Leah Dudley		Dentons Global Advisors		[phone] E: [e-mail]

About Spirent Communications plc

Spirent Communications plc (LSE: SPT) is the leading global provider of automated test and assurance solutions for networks, cybersecurity, and positioning. The Company provides innovative products, services and managed solutions that address the test, assurance and automation challenges of a new generation of technologies, including 5G, SD-WAN, Cloud, autonomous vehicles and beyond. From the lab to the real world, Spirent helps companies deliver on their promise to their customers of a new generation of connected devices and technologies. Further information about Spirent Communications plc can be found at https://corporate.spirent.com/ .

Spirent Communications plc Ordinary Shares are traded on the London Stock Exchange (ticker: SPT; LEI: 213800HKCUNWP1916L38). 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 https://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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