Allied Electronics (Altron) has issued a trading statement warning shareholders that earnings for the financial half-year ended 31 August 2014 will be substantially lower than last year.
The company states that Altron TMT (comprising Altech and Bytes’ telecommunications, multi-media and IT businesses) produced pleasing results during the period under review, showing a growth in headline earnings.
The integration of Altech and Bytes has yielded further significant benefits during the last six months. Altech Autopage Cellular has seen a decline in its profitability during the last six months, but a stronger second half is anticipated.
Strong performances were however recorded at Altech Netstar and the Bytes businesses.
Altron Power (comprising the Powertech group’s businesses) experienced challenging trading conditions during the last six months. The four week NUMSA strike in July severely impacted the business and this was exacerbated by the preceding mining sector strike. Much of the decline was experienced in the Transformers business which also suffered from low demand and productivity issues.
Encouragingly, Altron Power’s cables business posted growth in both revenue and earnings compared to the previous corresponding period.
Altron Corporate incurred a higher interest charge during the last six months due to the borrowings taken on to acquire the Altech minorities in August 2013.
Shareholders are advised that the company’s headline earnings per share for the half-year are expected to be between 10% and 16% lower than last year, while basic earnings per share are expected to be between 21% and 31% lower as against the previous corresponding period.
Altron has also advised shareholders that the company’s normalised headline earnings per share is expected to be between 18% and 24% lower as against the previous corresponding period. The impact of the NUMSA strike accounts for a significant portion of the decline in earnings.
Altron’s interim financial results for the half-year ended 31 August 2014 are expected to be announced on about 8 October 2014.
