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LONDON (Alliance News) - Volex PLC on Monday swung to a full year profit as restructuring costs subsided and revenue grew on its new sales strategy.
For the year ended April 1, the cable maker swung to a pretax profit of USD7.0 million from a USD8.5 million loss the year prior. This was after revenue grew to USD322.4 million from USD319.6 million the year before.
Profit performance was helped by a sharp fall in one-off costs during the year. Non-recurring expenses fell to USD2.7 million from USD15.7 million the year before.
This was primarily driven by the disappearance of the USD12.5 million portfolio realignment impairments the year before which were not repeated as it restructured its power cords unit. In addition, restructuring costs halved to USD860,000 from USD1.7 million the year before.
On an underlying basis - excluding one-off costs - pretax profit widened to USD9.7 million from USD7.2 million the year prior.
Volex does not pay a dividend.
"The return to top line growth, albeit modest, validates the new sales strategy with the growth coming from both new and existing customers, most notably a well-known manufacturer of electric vehicles which has scaled from a standing start in the prior year to a multi-million dollar account," Volex Executive Chairman Nat Rothschild said.
"The improved trading position has enabled the board to consider its longer term strategic objectives and in this regard I am grateful for the support we have received from our shareholders post year end in raising GBP36 million of equity capital," Rothschild said. "These funds will be used to strengthen our balance sheet, enable factory automation and for targeted acquisitions. Volex is in a much stronger position now, than it has been for many years."
In late April, Volex raised USD46.9 million from the issue of 48 million shares at 75 pence each. Shares in Volex were 1.2% lower at 80.05 pence on Monday.
Whilst our core markets are expected to remain highly competitive in the near term," Rothchild continued, "with an encouraging set of projects in the sales pipeline, we anticipate that our underlying revenues will continue to deliver organic growth in the coming year."
Shares in Volex were trading 1.2% lower at 80.05 pence each on Monday morning.
