Avingtrans Share News (AVG)

(Sharecast News) - Avingtrans reported higher interim earnings and improved margins for the six months ended 30 November on Wednesday, as strength in its Advanced Engineering Systems division and a reduced loss in Medical and Industrial Imaging offset flat revenues.

Group revenue was broadly unchanged at £78.1m, compared with £79m a year earlier, in line with management expectations.

Gross margin increased to 31.7% from 30%, reflecting an improved aftermarket mix in the Advanced Engineering Systems division.

Adjusted EBITDA rose 10.4% to £9.6m, driven mainly by reduced losses in Medical and Industrial Imaging, while the adjusted EBITDA margin improved to 12.3% from 11.0%.

The AIM-traded firm said adjusted profit before tax increased 27.1% to £5.7m and adjusted diluted earnings per share from continuing operations rose to 14.6p from 12p.

Cash inflow from operating activities strengthened to £7.6m from £4.9m, and net debt excluding IFRS 16 liabilities remained unchanged at £12.3m as at 30 November despite ongoing investment in medical imaging and new nuclear technology.

The board declared an interim dividend of 2p per share, up from 1.9p.

Within Advanced Engineering Systems, revenue was £75.2m compared with £76.8m a year earlier, reflecting an anticipated second-half weighting, while EBITDA was steady at £11.0m.

Hayward Tyler benefited from global growth in data centre infrastructure and electrification, securing $16m of new nuclear contracts with Korea Hydro & Nuclear Power.

Ormandy saw strong demand linked to AI and data centres, while Metalcraft continued ramping up 3M3 box production for Sellafield and Booth secured £8.5m of additional contracts with HS2 and Transport for London.

Aftermarket activity continued to build across the division, although Slack and Parr's recovery was impacted by US tariffs.

Medical and Industrial Imaging revenue increased 33% to £2.9m as product roll-out progressed, while the LBITDA loss narrowed to £0.8m from £1.7m.

Adaptix received 510(k) approval from the US Food and Drug Administration, enabling orthopaedic system sales in the US, and continued appointing distributors across key markets.

Magnetica expected to submit for 510(k) approval in the second half of the 2026 calendar year and completed the design of a new product concept for ViewRay.

SciMag reported increased orders for magnet and cryogenic systems used in quantum computing.

"A strong first half performance from the Advanced Engineering Systems (AES) division has primed the group to achieve full year expectations, with Medical and Industrial Imaging sales also building momentum," said chairman Roger McDowell.

He added that prospects for AES were "driven by global energy demand - especially in next generation nuclear power, which is in turn driven by the underlying rapid global growth in AI and data centre infrastructure and electric vehicles."

McDowell said the commercialisation of Adaptix's 3D X-ray systems could now build following 510(k) approval and described the management team in Medical and Industrial Imaging as complete following the appointment of Stuart Gall as divisional chief executive.

"Overall, our value creation objectives remain on course, supported by a prudent approach to debt management," he said, adding that the board remained confident about meeting full-year market expectations.

The order book in Advanced Engineering Systems was secured to achieve more than 95% of full-year 2026 market expectations, providing visibility into the second half.

The board said it remained confident in achieving expectations for the year and was positive about the group's medium-term prospects, supported by strong order intake and contract revenue recognition.

At 1130 GMT, shares in Avingtrans were up 1.24% at 572p.

Reporting by Josh White for Sharecast.com.