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31 Mar 2009 10:00
SEPURA PLC
PRE-CLOSE STATEMENT IN RESPECT OF THE FINANCIAL YEAR ENDING 31 MARCH 2009
Sepura plc, a global leader in the design, development and supply of TETRA digital radios, today issues the following pre-close statement in relation to its financial year ending 31 March 2009.
The Company has performed as expected in the final quarter of the year and therefore trading results for the full year, excluding exceptional items as noted below, will be in line with its expectations.
We continue to make good progress in the important German market and today announce a further contract win for the state of Bavaria.
Following a comprehensive benchmarking review of our European manufacturing needs we have agreed a new contract with MELECS EWS GmbH, which will result in immediate product cost savings to the Company. MELECS, formed from Siemens' contract manufacturing business (SIMEA), has operations in Austria and Romania. Our existing contract manufacturing relationship with TCB in China has been extended to cover more of our product portfolio, and continues to perform strongly.
The Company has also undertaken a major review of its internal operations and as a result will incur the following exceptional charges which will impact the full year results:
1. The Company's operations will be restructured to improve efficiency and streamline costs. This will result in a reduction of up to 45 permanent and temporary positions. A provision of £1.3m will be made in this year's accounts to cover redundancy and related costs. Collective consultation with the Staff Council will begin immediately. The cost reduction from the restructuring will be re-invested in increasing Sepura's international sales resource and in new product development. Overall, this will result in a small reduction in total operating costs.
2. Sepura has also reviewed its portfolio of development projects which has led to an alternative, more cost effective approach on some of our projects. This will result in a non- cash write-off of approximately £1.2m of non-current intangible assets.
Chairman Philip Nolan commented: "Under our new CEO the Company has taken a number of steps to streamline costs, refocus our development portfolio and add weight to our sales resource. This will position us strongly for continued growth in the TETRA market. Our success in winning the first four tenders in the important German market highlights the competitive strength of the Company."
CEO Gordon Watling commented: "The actions I have taken will significantly improve the efficiency of the business, allowing us to redirect resources into delivering more new products and increasing sales presence in key regions, both critical to driving the future sales and market share growth of the Company."
The Company expects its next report to shareholders to be the Preliminary Results Announcement for the year ended 31 March 2009, which it plans to issue during the first week of June. A full update on all the above issues will be given as part of that announcement. This will be followed by the Company's Annual Report & Accounts, intended to be issued in late June, and the AGM which is due to take place in late July. A confirmatory announcement of the final dates for each of these will be made in due course.
For further information please contact:
Sepura plc Tel: 01223 876 000
Phil Nolan, Chairman
Gordon Watling, Chief Executive Officer
Steve Crowther, Chief Financial Officer
Powerscourt (Media Enquiries) Tel: 020 7250 1446
Paul Durman
Cautionary Statement:
This pre-close statement contains certain forward-looking statements with respect to the operations, performance and financial condition of Sepura. By their nature, future events and circumstances can cause results and developments to differ from those anticipated. Nothing in this pre-close statement should be construed as a profit forecast. No undertaking is given to update the forward-looking statements whether as a result of new information, future events or otherwise.
Notes to Editors:
About Sepura
Sepura is a global leader in the design, development and supply of TETRA (TErrestrial Trunked RAdio) digital mobile radios, used predominantly by the emergency services around the world as well as in the military, transportation, utilities, local government and commercial sectors.
The TETRA standard was developed mainly for public safety professionals. It facilitates reliable radio communication at all times and offers secure voice and data transmissions - free from the possibility of eavesdropping. Sepura has rapidly expanded across the world with a network of more than 90 regional partners that sell and support locally its market-leading products in over 90 countries. It is now the market leader in more than 25 countries.
Sepura's development expertise is focused entirely on TETRA radio terminals, and the Company offers the broadest range of TETRA products available. It is the market leader in the supply of surveillance and other specialist TETRA radios and accessories.
Based in Cambridge, England, and employing some 350 people, Sepura was admitted to the Official List of the London Stock Exchange on 3 August 2007.
For further information please visit www.sepura.com
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