Last checked at 13 Nov 2018 07:00
13 November 2018
TT Electronics plc
Trading Update
TT Electronics ("TT" or the "Group"), a global provider of engineered electronics for performance critical applications, today publishes this trading update to the end of October 2018.
Trading for the Group has continued to be positive. For the year to date, group revenue is up 5% on an organic¹ basis compared to the prior year, with all three divisions growing in the last four months. The good revenue, profit and order momentum across all three divisions is as expected.
We have continued to see positive order intake across all three divisions, and, adjusting for the impact of acquisitions, the order book continues to be strongly ahead of the prior year, supporting our confidence in the improved growth continuing for the remainder of the year and into the early part of next year.
The integration of Stadium and Precision is progressing well and the acquisitions are performing in line with our expectations.
We are investing in our strategic priorities focusing on business development and product R&D. More specifically in response to opportunities in connected devices highlighted from the integration of Stadium, in October we opened an Advanced Technology Centre in Shenzhen, adding scale and capability in Asia to complement existing capabilities in Kista, Sweden.
On 12 November, we signed an agreement to establish a joint venture with our long-term supply partner, Uniroyal Electronics Industry ("Uniroyal") for sensing and power management devices. Uniroyal is the world's second largest manufacturer in this growing technology. The partnership will combine TT's design engineering and worldwide distribution channels with Uniroyal's penetration in the Asian market and higher volume manufacturing capabilities to target the automotive, industrial automation, and other higher volume market segments. Revenues from the joint venture are expected to commence in the second half of 2019. We expect to invest $4.5 million in 2019, and to significantly exceed our 12% pre-tax return on investment capital hurdle in 2020.
Commenting Richard Tyson, Chief Executive Officer said:
"We continue to see a very good performance from across the business with ongoing order momentum and revenue growth. We are investing in areas that will support the future growth of the business including an exciting joint venture opportunity with Uniroyal. The integration of Stadium and Precision is progressing well. Overall the enlarged business is performing as expected.
Following a first half with good revenue growth and significant margin improvement, momentum has strengthened into the second half of the year. We are on track with our plans for the year as a whole and confident of meeting the enhanced expectations we set out at the time of our interim results. TT is in good shape as we head into 2019."
Investor event
On Thursday 15 November, we will be holding an investor event where members of our senior leadership team will be presenting their views on the opportunities available for the development of the business in our target markets and illustrating our differentiated positions with our customers. The presentation materials will be available on the IR section of our website following the event.
For further information please contact: |
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TT Electronics plc | Tel: +44 (0)1932 825 300 | |
Richard Tyson, Chief Executive Officer Mark Hoad, Chief Financial Officer Emma Darke, Head of Investor Relations and Communications | ||
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MHP | Tel: +44 (0)20 3128 8100 | |
Tim Rowntree / Katie Hunt | ||
Notes
¹Excluding the impact of exchange rates, acquisitions and disposals
Uniroyal Electronics Industry Co. Ltd was founded in 1978 in Hsin-Chu, Taiwan. Further information can be found at www.uniohm.com
About TT Electronics
TT Electronics is a global provider of engineered electronics for performance critical applications. TT Electronics is a global provider of engineered electronics for performance critical applications.
The company operates in industries where there are structural growth drivers, working with market-leading customers in industrial, medical, aerospace and defence, and transportation sectors. Products designed and manufactured include sensors, power management devices and connectivity solutions. TT has design and manufacturing facilities in the UK, US, Sweden and Asia.
The company has three divisions. The Sensors and Specialist Components division works with customers to develop standard and customised solutions including sensors and power management devices. Our solutions improve the precision, speed and reliability of critical aspects of our customers' applications. The Power and Connectivity division designs and manufactures power application products and connectivity devices which enable the capture and wireless transfer of data. We collaborate with our customers to develop innovative solutions to optimise their electronic systems. The Global Manufacturing Solutions division provides manufacturing services and engineering solutions for our product divisions and to customers that often require a lower volume and higher mix of different products. We produce printed circuit board assemblies through to full electronic products to our customers' designs coupled with engineering testing and integration services.
Cautionary statement
This trading update contains forward-looking statements. These have been made by the directors in good faith based on the information available to them up to the time of their approval of this update. The directors can give no assurance that these expectations will prove to have been correct. Due to the inherent uncertainties, including both economic and business risk factors underlying such forward looking information, actual results may differ materially from those expressed or implied by these forward-looking statements. The directors undertake no obligation to update any forward-looking statements whether as a result of new information, future events or otherwise.