Last checked at 12 Apr 2012 07:00
12 April 2012 XP Power Limited ("XP Power" or "the Group") Interim Management Statement
XP Power, one of the world's leading developers and manufacturers of critical power control components to the electronics industry, is today issuing an Interim Management Statement for the quarter ended 31 March 2012.
Trading
As discussed in our 2011 Final Results announcement, following comparatively weak order intake in the final quarter of 2011 we expected a reduction in revenues in the first quarter. In the event, Group revenues in the three months to 31 March 2012, declined by 10% over the same period in 2011 with the weakness most evident in the industrial sector. In constant currency the decline was 11%.
While the environment for capital goods spending remains subdued, order intake in the first quarter of 2012 has been stronger than that experienced in the final quarter of 2011 and we therefore expect stronger revenues in the second quarter of 2012.
In addition, our product mix has continued to improve, with own design products representing 60% of revenue in the first quarter of 2012 versus 57% of revenue for the year ended 31 December 2011.
Our newly commissioned factory in Vietnam commenced production of its first magnetic components during the first quarter, as planned. As expected, while the start up costs of Vietnam will negatively impact the gross margins in 2012 we expect that Vietnam should reach a break even position by the end of 2012.
Financial Position
Net debt was £18.0 million at 31 March 2012 compared to £18.6 million at the year end. Using the exchange rates prevailing at the year end, net debt at 31 March 2012 would have been £18.3 million.
Dividend
A dividend for the first quarter of 10 pence per share (2011: 9 pence per share) will be paid on 10 July 2012 to shareholders on the register at 15 June 2012.
Outlook
While customers are placing orders at an increased rate, from the depressed levels of the fourth quarter 2011, the global economic environment remains weak for the capital equipment which they manufacture. We currently anticipate 2012 will be a flat revenue year following the past two years of strong industry growth.
XP will issue a trading update for the six months to 30 June 2012 on 9 July2012. - Ends - Enquiries:XP Power
Duncan Penny, Chief Executive +44 (0)7776 178 018
Jonathan Rhodes, Finance Director +44 (0)118 976 5074
Citigate Dewe Rogerson +44 (0)20 7638 9571
Kevin Smith/Jos Bieneman
Note to editors
XP designs and manufactures power controllers, the essential hardware component in every piece of electrical equipment that converts the power from the electricity grid into the right form for the equipment to function.
XP typically designs in power control solutions into the end products of major blue chip OEMs, with a focus on the industrial (circa 45% of sales), healthcare (circa 26% sales) and technology (circa 29% of sales) sectors. Once designed into a program, XP has a revenue annuity over the life cycle of the customer's product which is typically 5 to 7 years depending on the industry sector.
XP has invested in research and development and its own manufacturing facility in China, to develop a range of tailored products based on its own intellectual property that provide its customers with significantly improved functionality and efficiency.
Headquartered in Singapore and listed on the Main Market of the London Stock Exchange since 2000, XP serves a global blue chip customer base from 27 locations in Europe, North America and Asia.
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