Xp Power Regulatory News (XPP)

XP POWER LTD - Trading Statement

PR Newswire

London, January 9

XP Power, one of the world's leading developers and manufacturers of criticalpower control components to the electronics industry, is today issuing atrading update for the fourth quarter ended 31 December 2012.

Trading

Revenues for the twelve months ended 31 December 2012 were 9% lower than thoseachieved in 2011. In constant currency revenues also declined by 9%. Customerscontinue to be cautious in placing new orders and taking delivery of productfrom their existing call off orders.

Although markets have remained challenging, revenues showed a marginalsequential improvement from the first half of the year to the second half.Factory loading in our Chinese facility has increased and start-up losses inour new Vietnamese facility have declined. These combined factors should resultin a solid improvement in gross margins in the second half of the year comparedto the first half, as expected.

Financial Position

Net debt was £10.7 million at 31 December 2012 compared to £18.6 million at 31December 2011. Using the exchange rates prevailing at 31 December 2011, netdebt at 31 December 2012 would have been £11.1 million.

Dividend

A dividend of 12 pence per share for the third quarter will be paid today, 10January 2013, to shareholders on the register at 14 December 2012.

The dividend for the fourth quarter of 2012 will be announced with the 2012final results on 25 February 2013 but is not expected to be less than 16 penceper share, representing a minimum total dividend of 49 pence per share for2012, an increase of 9% over the total dividend of 45 pence per share paid for2011.

Outlook

XP Power's customers supply capital equipment to markets across the globe. Themacro-economic outlook for these customers appears to be less positive entering2013, in an environment characterised by reduced government spending andincreased taxation, which are not generally positive indicators for increasedinvestment in capital equipment.

Orders received in the second half of 2012 are 8% higher than the comparableperiod in 2011. However, at this early stage of the year, this would indicateflat or only modestly increased revenue for 2013.

XP Power has a long-established strategy of targeting blue chip customers withstrong leadership positions in their respective markets, and whose requirementto vet their suppliers' design and manufacturing facilities acts as asignificant barrier to entry to many of the Group's competitors. The success ofthis strategy has mitigated some of the reduction in the market for powersupplies in 2012 and should leave us well placed for the year ahead. We expectfurther successful factory audits and customer wins in 2013 but are cautiousgiven the state of capital equipment investment in our customers' end usermarkets at present.

Duncan Penny, Chief Executive +44 (0)118 976 5086

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 componentin every piece of electrical equipment that converts the power from theelectricity grid into the right form for the equipment to function.

XP typically designs in power control solutions into the end products of majorblue chip OEMs, with a focus on the industrial (circa 40% of sales), healthcare(circa 30% sales) and technology (circa 30% of sales) sectors. Once designedinto a program, XP has a revenue annuity over the life cycle of the customer'sproduct which is typically 5 to 7 years depending on the industry sector.

XP has invested in research and development and its own manufacturing facilityin China, to develop a range of tailored products based on its own intellectualproperty that provide its customers with significantly improved functionalityand efficiency.

Headquartered in Singapore and listed on the Main Market of the London StockExchange since 2000, XP serves a global blue chip customer base from 27locations in Europe, North America and Asia.