19 May 2009
At the Annual General Meeting of Spectris plc being held today, the Chairman, John Hughes, will make the following Interim Management Statement covering the period from 1 January up to 18 May 2009.
At the time of our preliminary results announcement in February, we indicated that market conditions were challenging. Since that time, we have seen no material change in these conditions. On a constant currency organic basis, sales for the four months ended 30 April 2009 were 18% lower than the strong comparable period last year. On a reported basis, however, with the contribution from acquisitions (+7%) and beneficial effects from currency (+20%), revenue increased by 9%. Revenue performance from acquisitions is, in the main, expected to be in line with or better than comparable Spectris segment performance.
On a segmental basis, the most challenging conditions are in Test and Measurement, where demand from automotive and consumer electronics customers is particularly weak.
Taking into account all of the above, together with the costs of accelerated acquisition integration as well as the costs of the previously announced group-wide restructuring initiatives, there will be a material impact on H1 profitability.
The group continues to maintain a strong financial position. In January we extended our committed bank funding with an additional £50 million, five-year term loan facility. Operating cash conversion is expected to remain strong.
On 6 February, we acquired 100% of the share capital of Lochard Limited for an initial consideration of Australian $41 million (£19 million). Lochard is a market leader in the provision of airport noise management solutions based in Melbourne, Australia, and the acquisition extends the group's capabilities in environmental monitoring systems.
Market conditions show few signs of improvement, visibility continues to be very limited and we remain cautious with respect to the prospects of any significant short-term recovery. Nonetheless, we expect to see an improving performance in H2 resulting from the benefits of the restructuring and post-acquisition integration actions as well as anticipating some improvement in the level of business; we therefore presently expect pre-tax profits for the full year to be around the low end of analysts' current expectations (Source: Bloomberg £79m).
Spectris will issue a trading update on 16 July 2009, ahead of its interim results announcement on 25 August 2009.
