Last checked at 16 Jun 2011 07:00
16 June 2011 XP Power Limited ("XP Power" or "the Group") Trading Update
XP Power, one of the world's leading developers and manufacturers of critical power control components to the electronics industry, is today issuing a trading update for the second quarter ending 30 June 2011.
Trading
Trading in the second quarter to date has continued to be strong. Group revenues, for the six months to 30 June 2011, are expected to grow by more than 25% over the same period in 2010. In constant currency the growth rate is expected to be not less than 29%.
In addition, we have seen a further favourable change in the product mix during the period, with a continuing growth in the proportion of own design product. Own design product represented 53% of revenue in the first quarter of 2011 and this has increased further to 55% in the first two months of the second quarter, versus 48% of revenue for the year ended 31 December 2010. This will have a positive impact on gross margins in the six months to 30 June 2011.
Construction work on our new Vietnamese factory continues to progress to schedule and the facility is expected to be completed during the first quarter of 2012.
Management Succession
Having held executive roles on the XP Board since the public listing in 2000 and with the Group's strategic transformation from distributor to designer and manufacturer of its own range of products now complete, Larry Tracey, Executive Chairman, and James Peters, Deputy Chairman, have indicated their intention to relinquish their executive duties in April 2012, at which point they will become non-executive directors.
Duncan Penny, Chief Executive, will assume full responsibility for the day to day management of the business from this point, with Mike Laver, North American President and Executive Director, assuming responsibility for global sales and marketing. Larry and James will effect a progressive transition of their responsibilities over the next ten months to ensure an orderly handover.
Outlook
The Group is continuing to increase market share in its key industrial, healthcare and technology sectors. New project wins with our own in-house developed products have, despite strong revenue growth, led to orders outpacing revenues by 10% in the year to May. This robust performance gives us confidence in our ability to achieve strong revenue growth for this year. Furthermore, the record number of new product introductions made in the past two years should underpin continued market share gains in 2012 and 2013 as the associated projects enter production with our customers.
Larry Tracey, Executive Chairman, said: "With the Group's strategic repositioning as a designer and manufacturer now complete, and having spent more than ten years in executive roles on the Board, both James and I believe that now is the right time to look to the future and put in place the management structure for the next phase of growth.
Duncan Penny has proved himself a very able CEO since taking up the position in 2003 and he is supported by a strong tier of operational managers throughout the business, all of whom have made significant contributions to the Group's development. This managed succession provides clear opportunities for this core team as we seek to build on the foundations we have laid over the last few years and is being implemented against both a background of strong trading and over a 10 month period to ensure an orderly handover of responsibilities."
XP will issue its interim results for the six months to 30 June 2011 on 1August 2011. - Ends - Enquiries:XP Power
Larry Tracey, Executive Chairman +44 (0)7785 387142
James Peters, Deputy Chairman +44 (0)7785 353066
Duncan Penny, Chief Executive +65 8322 9520
Citigate Dewe Rogerson +44 (0)20 7638 9571
Kevin Smith/Ged Brumby
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 50% of sales), healthcare (circa 30% sales) and technology (circa 20% 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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