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03 May 2013
Laird PLC today announces its Interim Management Statement for the period from 1 January 2013 to 3 May 2013. Laird is a global technology company focused on providing components and solutions that protect electronic devices from electromagnetic interference and heat, and that enable connectivity through wireless applications and antennae systems.
Revenue in the first quarter was £119 million (2012: £122 million), 2% lower than the previous year. Revenue expressed in US dollars was $186 million (2012: $191 million). On an organic* basis, revenue was 6% lower in the first quarter of 2013. We have seen a pick-up in the rate of design activity and design wins, although softness in the B2B markets in the first quarter has resulted in lower revenue. In addition revenue with our largest customer was 17% lower year on year. As a result operating margin has been impacted by lower revenue and lower overhead absorption on an expanded production base.
As stated in our full year results announcement in March, we continue to expect revenues to be weighted towards the second half of the year. We expect revenues for the second quarter to follow the same year-on-year trend we have experienced in the first quarter, with a return to year-on-year growth in the second half as we benefit from our own and our customers’ new product launches. Our increasing investment in R&D further reinforces our confidence for revenue growth in the second half of the year. As a result of these new product launches and increasing investment, together with the translation benefit from a stronger US dollar than originally anticipated, our expectations for the full year remain unchanged.
We remain confident in our growth strategy. This is underpinned by recent significant, long-term contract wins with key automotive customers in the Telematics business, our improving ability to penetrate new markets, and the ongoing demand we see for smart antenna and performance materials solutions to manage smaller, higher powered devices.
Performance Materials Division
In the Performance Materials division, revenue in the first quarter was £73 million (2012: £74 million). Expressed in US dollars, revenue was $114 million (2012: $115 million). Compared to the first quarter of 2012 revenue for the division on an organic* basis was 6% lower. Trading in this division has experienced lower demand from our largest customer but we have maintained a strong market share with this customer and expect to benefit as new products are launched in the second half of the year.
We are making good progress in penetrating new customers in the automotive, consumer and medical markets and within new geographic market segments in this division.
The integration of Nextreme, acquired in February, is well underway and the business has secured a new contract to supply an international semiconductor company.
Wireless Systems Division
In our Wireless Systems division, revenue in the first quarter was £47 million (2012: £48 million). Expressed in US dollars, revenue was $73 million (2012: $76 million). Compared to the first quarter of 2012, revenue for the division on an organic* basis was 7% lower. This was due to a general slowdown in wireless spending and lower sales to the public safety market against a strong comparison last year.
There continues to be good demand for the smart antennae solutions we provide and there have also been a number of key new contract wins with international automotive customers. Over the medium-term, these customers have the potential to represent an increasingly significant proportion of Laird’s overall customer base.
As part of our ongoing programme to refresh the Board we are pleased to announce that Jack Boyer is to join Laird as a non-executive director with effect from 7 May 2013. Jack brings significant experience in both the international technology and engineering sectors, and in the capital markets.
Tony Reading will retire from the Board on 31 August 2013 after serving as a non-executive director for nine years.
Full details of these changes are contained in a separate announcement issued today.
Strong Balance Sheet
Our financial position remains healthy. Our business continues to be cash generative which allows us to maintain our innovation and R&D investment.
Our customers continue to recognise the differentiation Laird can provide – innovation, reliable fulfilment and speed – and we are focused on delivering our strategy to serve the right markets which exhibit good growth prospects, with an innovative breadth of products and solutions.
We continue to expect revenue to be weighted towards the second half of the year and our expectations for the full year remain unchanged.
* Organic growth: On a pro-forma basis, restating prior year comparatives as if acquisitions were owned for the equivalent period of the prior year, and in US Dollars.
David Lockwood, Chief Executive
Jonathan Silver, Finance Director
Anna Hartropp, Head of Investor Relations
Tel: 020 7468 4040
Tel: 020 3128 8100
A call for Analysts and Investors will be held at 8:00am (UK time), hosted by David Lockwood and Jonathan Silver. Participant Tel No: +44 (0)20 3139 4830. Participant passcode: 69161623#.
Replay: +44 (0)20 3426 2807. Passcode: 638917#
Interim Management Statement (154KB PDF)
Laird is a global technology company focused on providing components and solutions that protect electronic devices from electromagnetic interference and heat, and that enable connectivity through wireless applications and antennae systems.