LONDON (Alliance News) - Tube manipulation specialist Tricorn Group PLC Wednesday warned on its outlook for the second half due to a slowdown in key markets, even as it turned a small profit for the first half thanks to cost-cutting across the business.
Tricorn said conditions in its markets deteriorated towards the end of the first half to the end of September, and this weakening has continued into the second half. As a result, it now expects its revenue for the full year will be down by around 10% year-on-year and it has already kicked off cost-cutting plans to mitigate the issues.
The group added, however, that while its results for the year to the end of March 2016 will miss market expectations, the cost-cutting efforts it will make should mean it still turns an operating profit for the year.
For the first half, cost-cutting across the business benefited the bottom line, as Tricorn made a pretax profit of GBP38,000, compared to a GBP70,000 loss a year earlier, as revenue fell to GBP10.1 million from GBP10.6 million.
Sales increased from its US and China facilities in the half, with the operational performance of the US business substantially improved.
"The group has made further progress through the first half of the year. Our USA business has increased revenue through new business growth, continued to improve operationally and was profitable for the period. In China the businesses have delivered further increases in revenue," said Chairman Andrew Moss.
"The board is optimistic about the group's longer term growth opportunities and encouraged by recent market share gains. Profitability will benefit further from the lower operational costs as and when markets recover," Moss added.
Shares in Tricorn were down 3.7% on Wednesday at 13.00 pence.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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