Interim Management Statement

RNS Number : 0736S

TT electronics PLC

15 November 2011

 



TTG

TT electronics plc

Interim Management Statement

TT electronics plc, a leader in electronic component and sensor technology, issues this Interim Management Statement, in accordance with the UK Listing Authority's Disclosure and Transparency Rules, for the period from 1 July 2011, based on trading results for the four months ended 31 October 2011.

In the Interim Results announcement in August, we reported a further significant improvement in performance in the first half year over that achieved in 2010. This stronger performance has been maintained in the second half of the year and we continue both to improve margins and to position the business for sustainable growth. Sales in the ten months to October 2011 were approximately 7% ahead of the comparable period last year at constant currency rates, noting that 2010 strengthened significantly in the second half.

The Components division has continued to trade in line with our expectations, although there has been some easing of order levels more recently as distributors re-balance inventory levels for the year end following a spike created by the Japanese earthquake.  We continue to see increased levels of engagement with key customers and in China we have recently won business for an optical device with a major medical company and for high voltage resistors for a transmission equipment manufacturer.  This progress demonstrates our ability to create a sustainable differentiated position in selected markets and gives us confidence that we will deliver further improvements in performance. The fit-out programme has started at our new Eastern European manufacturing facility in Romania which is being established to meet increased demand from existing customers. The closure of the site in Boone, North Carolina and transfer of production to Mexico is progressing as planned.

The Sensors division has seen strong demand from its premium automotive customers who are benefiting from their global presence and growth in emerging markets.  The actions we have taken mean that the division is well positioned to support these customers and we are increasingly being seen as a critical global supplier partner.  During the period we successfully secured significant new business with VW to provide sensors for new engine platforms to be manufactured in volume in Germany, Mexico and China, with start of production commencing at the end of 2012.  We have won new business with local OEMs in emerging markets by identifying and supplying differentiated technical solutions for critical sensing applications to meet our customers' demands.  Our success with existing and new customers, and the increasing deployment of sensors in our end markets, provides many opportunities to grow and develop the division.

The Integrated Manufacturing Services division has continued to trade well with a good performance in all regions. As anticipated at the half year, trading in the Secure Power division has improved with a significant increase in orders, particularly in Mexico and Latin America. Strong demand for the new containerised generating set range of products has supported growth in the UK business.

Cash flow performance since the half year has improved from ongoing management of working capital and capital expenditure, and also from disposal proceeds. Net debt at the end of October was £17.0m compared with £24.2m at 30 June and the Group is aiming to achieve a net cash position by the end of the year.

In the light of the strong performance to date and good order book visibility through to the end of the year, the Board is confident that the Group will meet its expectations for the current year. While macroeconomic uncertainty has increased in the past few months, we continue to drive the business through strengthening our position with customers, enhancing our product portfolio and improving operational efficiency across our facilities. These actions, coupled with the positive medium term demand dynamics in our target end-markets, underpin the delivery of further sustained growth and margin improvements.

Enquiries:

TT electronics plc                                                                  Tel:  [phone]

Geraint Anderson, Group Chief Executive

Shatish Dasani, Group Finance Director

Biddicks                                                                                 Tel:  [phone]

Zoë Biddick

Note:

This statement contains certain forward-looking statements.  Such statements are made by the Directors in good faith based on the information available to them at the time of the announcement and they should be treated with caution due to the inherent uncertainties underlying any such forward-looking information.

 

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