DSN.L Regulatory News (DSN)

7 Aug 2007 15:30

Densitron Technologies PLC07 August 2007 Densitron Trading update 2007 sees the Company as a lean and focused organization. The planned disposals of the loss making businesses, Gaming and PublicInformation Displays, have enabled the Company to concentrate on its corebusiness of Display Solutions and investments in the land at Blackheath and theshares in VBest Electronics Co. Limited. It is expected that the results for the 6 months to 30 June 2007 will be in linewith the Company's internal budgets and will show orders of £8.7m representingan increase of 39% on the second half of 2006 and 3% on the first half of 2006.Sales are expected to be £7.0m representing a decrease of 6% on the second halfof 2006 and 11% on the first half of 2006. A significant part of this decreasecan be attributed to the weakness of the US dollar against the pound which hasshown a depreciation of over 10% on the comparable period in 2006. The order book has grown in the 6 months to 30 June 2007 by £1.6m toapproximately £6.7m, an increase of 31% over December 2006 and the majorproducts pipeline continues to grow. The outlook for the Display Solutions business is positive as a result of thegroundwork done in the first half of the year. We have started to expand ourglobal distributor net work and are pleased to have added Sweden and Spain. Inparallel we have forged relationships with new suppliers including a plasticsfactory to give access to complete products. Our focus remains to achieve goodmargins for the knowledge that we contribute to projects that we run for ourcustomers. We are very pleased to report that we continue to attract new talent. Having succeeded in the legal action against the Old Addeyans Football Club totake possession of the land at Blackheath the Company has continued itsnegotiations with the Local Authority over the terms of the proposed land swap.We have had one offer for some of the Land and are currently in negotiations onthis. Shareholders will be advised when there are further developments. VBest Electronics Co. Limited remains a significant investment to the Group andas such considerable Board attention is given to its management. Densitron has 2seats on the VBest Board. Grahame Falconer and Vincent Linn represent Densitronon the VBest board. During the first 6 months of the year Grahame Falconer andTim Pearson and other senior members of staff have visited both VBestHeadquarters in Taipei and also the main LCD and LCM factory in China. VBest has shown considerable sales growth in the first 6 months of 2007 whichhas required the recruitment of some 300 additional production staff (around a40% increase) in the Kunshan factory in China. Inadequate training andsupervision has led to a deterioration in production yields which has resultedin the Company making a loss. Corrective measures have been put in place and theVBest Board is confident that the second half of 2007 will show an improvement.At the July Board Meeting the VBest Board approved changing the Company's nameto Evervision Limited. I reported in my statement in the Annual Report that the Company will look togrow its Display Solutions Division by organic growth and strategic acquisition.I can report that a number of companies have been identified as potentialacquisition targets but the prices sought are unrealistic. The Board remainscommitted to this strategy but will only proceed if it deems that an acquisitionis appropriate in both terms of activity and price. Your Board of Directors continues to believe that the market capitalisation ofthe company does not reflect the underlying asset value of the business. TheBoard will continue to take the necessary steps to improve the return from boththe operating activities and investments so that asset values are recognised. For further details please contact: Tim Pearson, Group Finance DirectorDensitron Technologies plc Tel: 0207 648 4200 John Wakefield, DirectorBlue Oar Securities Plc Tel: 0117 933 0020 This information is provided by RNS The company news service from the London Stock Exchange