Trading Update

RNS Number : 1608B

Volex PLC

12 April 2012

 



For immediate release                                                                                                                                       12 April 2012

VOLEX plc

Trading Update

Volex plc ('Volex' or the 'Group'), the global provider of electrical, digital and optical connections, today releases the following trading update for the three months ended 1 April 2012.

Trading in the final quarter of FY2012 remained resilient despite continuing economic uncertainty. Consumer revenue for the final quarter was in line with the same period last year, while year-on-year revenue growth in the Healthcare sector was again in excess of 20%. Telecoms/Datacoms revenue in the quarter continued to be affected by reduced spend by telecoms operators while trading in the Industrial sector, as predicted, largely recovered from the customer destocking experienced in Q3 FY2012. Consequently overall Q4 FY2012 Group revenue was down slightly on the same period last year, but still up almost 6% for the year as a whole.

The exceptional start-up costs reported in the Interim Management Statement of 13 January 2012 have, as anticipated, been winding down during the course of Q4 due to the on-going operational efficiency and quality improvements. As a result we have exited the year at the targeted yields and the costs for the full year FY2012 are at the lower end of the $5m-$6m range communicated in the IMS. Excluding the impact of these start-up costs, normalised⁽ⁱ⁾ gross margin in Q4 FY2012 was modestly above management's stated objective of exiting the year at around 20%. As a result, full year normalised⁽ⁱ⁾ operating profit will be slightly ahead of market expectations for the twelve months to 1 April 2012.

Despite significantly increased investment in capital expenditures and other areas of the business, cash generation continues to be strong with a net cash position again reported at the year end, ahead of market expectations.

Whilst economic conditions are expected to continue to be challenging in FY2013, the Board is confident that on-going investments, particularly in the areas of sales, operations and technology, will enable the business to deliver continued growth in revenues, margins and profit in line with management's expectations.

Results for the year ended 1 April 2012 will be announced on Tuesday 29 May 2012.

(i)     Normalised results stated before exceptional start-up costs and share based payments charge

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Volex plc

Ray Walsh                                          Group Chief Executive                                                                   [phone]

Andrew Cherry                                Group Finance Director                                                                 [phone]

Buchanan

Charles Ryland / Helen Chan / Louise Hadcocks                                                                                [phone]

Forward looking statements

Certain statements in this announcement are forward-looking statements which are based on Volex's expectations, intentions and projections regarding its future operating performance and objectives, anticipated events or trends and other matters that are not historical facts. Forward-looking statements are sometimes, but not always, identified by their use of a date in the future or such words as 'anticipates', 'aims', 'could', 'may', 'should', 'expects', 'believes', 'intends', 'plans', 'targets', 'goal' or 'estimates'.  By their very nature forward-looking statements are inherently unpredictable, speculative and involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements. Factors that could cause or contribute to such differences include, by way of example only and not limited to, general economic conditions, currency fluctuations, competitive factors, the loss or failure of one or more major customers, changes in raw materials or labour costs, and issues associated with implementing our strategic plan among other risks. Given these risks and uncertainties, prospective investors are cautioned not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date of such statements and, except as required by applicable law, Volex undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

 

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