Checkit Regulatory News (CKT)

12 Jan 2010 07:00

ELEKTRON PLC

Trading update

As Elektron Plc ("Elektron" or the "Group"), the AIM quoted engineered products manufacturer, approaches its year end, it announces today a trading update, a reorganisation of its divisions and the possible disposal of its stake in Hartest Holdings plc.

Trading update

In our Interim Report we stated that there were some signs of improvement in all of our markets but nevertheless we took a cautious view of the economy.

We continue to take a cautious view but are pleased to report that there has been a significant upturn in orders which is positive for current trading and is also expected to benefit the first few months of our next financial year. In December average daily order intake exceeded £175k per day which was a record for that month, representing a 74% increase on the prior year comparable figure.

Much of the increase in orders arose from customer restocking but various new sales and marketing initiatives have had a part to play.

The Board now believes that Elektron will perform significantly better than the current market forecast for the financial year ending 31 January 2010 pre exceptional charges in respect of restructuring the Group.

Divisional reorganisation

The Board also announces that the number of divisions in the Group has been reduced from three to two.

Elektron Technology ("ET", formerly Elektron Components Division) designs, manufactures and markets a range of world class components and custom technology platforms under the Bulgin, Arcolectric and SIFAM brand names. The division represents about 74% of Group turnover and is the main source of profits.

Elektron Ventures ("EV") houses the remaining business units representing about 26% of Group turnover. This portfolio comprises Digitron (manufacturer of temperature and pressure measurement instruments), Queensgate (nanomeasurement specialist), Total Carbide (tungsten carbide component manufacturer) and Titman (premium router cutter manufacturer).

The purpose of the reorganisation is to focus the Group and its management on the highest growth opportunities.

ET is currently concentrating on opportunities within the global connector market (estimated $35 billion sales in 2009). Each EV business unit will be managed for growth and where growth is not available, consideration will be given to disposal of the relevant business unit.

Possible sale of Hartest Holdings plc stake

The Board announces that it has signed a non binding letter of intent to enter into an irrevocable undertaking to accept an offer, when made, by Delta Controls Limited for all of the issued, and to be issued, share capital of Hartest Holdings plc at a price of 69p per share. There can be no certainty that Delta will make an offer or that any offer made will be successful. However in the event that an offer is successful Elektron expects to receive proceeds of approximately £1.37 million representing a profit on original cost of £0.01m and a profit on last reported carrying value of £0.90m.

For further information please contact: