Communications tech firm Filtronic says it expects the national 5G roll out to deliver a further rise in sales next year, as it posted a 9.6% rise in revenues in full year results.
The electronic component manufacturer, which has bases at NETPark in Sedgefield, County Durham, Yeadon in Leeds and Maryland, US, designs and makes products for the aerospace, defence, telecoms infrastructure and critical communications markets. The firm has published full year results for the year ended May 31 2022, in which it saw operating profit more than double from £600,000 to £2m on revenues of £17.1m. Adjusted ebitda was £2.8m, up from £1.8m, and overall gash generated from operating activities was £2.3m, down on last year’s £2.5m.
The company said its healthy cash position provides a platform for continued investment in growth initiatives and that the year saw Filtronic deliver on existing development contracts while also securing initial production orders. Sales of its “best-in-class” Tower Top Amplifier passed £1m in the financial year and it has also accrued a series of recent contract wins, totalling £1.9m across a diverse range of new customers, which it said demonstrates the execution of its objective to broaden its client base.
Chief executive Richard Gibbs said the firm performed well, despite the lingering impact of the Covid pandemic and constraints on the supply chain caused by the global shortage of critical semiconductor components. He also said investment in equipment has aided the firm’s growth.
Mr Gibbs said: “The addition of state-of-the-art equipment for rapid process and product development has significantly enhanced our ability to bring new products to market. The ability to develop engineering prototypes and create new manufacturing processes without the need to disrupt the volume manufacturing lines has greatly improved delivery of engineering programmes and eased the transition from prototype into production.
“Talented people remain at the heart of our ability to deliver leading edge products and future business growth. We have made significant efforts this year to find and recruit the specialist engineering and marketing skills required to realise our growth ambition. To further penetrate the UK aerospace and defence market we have strengthened our business development team with the addition of seasoned industry experts who have a strong track-record of sales delivery.”
Chairman Jonathan Neale said: “The group’s trading performance strengthens the balance sheet and provides a platform to further develop the business with continued investment in R&D, new product development and process capability. Execution of our technology roadmap will be a key focus this year as we expand and augment our product offering whilst also delivering bespoke developments to customers who trust us to solve their technically challenging RF problems. Broadening our customer base remains one of our key strategic objectives, and having strengthened our sales channels, we look forward to further progress having recently won several contracts to a range of new customers and markets that can deliver sustainable growth and long-term shareholder value.
“With the growing opportunity pipeline and order book, we anticipate further revenue growth, particularly as 5G telecommunication infrastructure rollouts gather pace, although the quality of earnings may be impacted due to price sensitivities in this market. This would be a timing issue, rather than normalised trading, given the development contracts we are working on in aerospace & defence and space where the mix is much stronger. The continued push by governments to utilise sovereign capability in the supply chain of key programmes in these markets positions the group well with opportunities regularly presenting themselves for us to capitalise on. Given the scale of some of these, we are open to exploring partnerships and other revenue models as a means of securing potential growth”.
