Product category:
Transformers and Inductors
News Release from: Abacus Group
Edited by the Electronicstalk Editorial
Team on 20 July 2005
Abacus warns of profit shortfall
Abacus Group now expects profits for the year to 30th September 2005 to be as much as 25% below consensus forecast.
Abacus Group now expects profits for the year to 30th September 2005 to be as much as 25% below consensus forecast The profit for the year, before tax, exceptionals and goodwill, is expected to be not less than GBP 8.0 million (2004: GBP 10.0 million)
This article was originally published on Electronicstalk on 24 Jun 2008 at 8.00am (UK)
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Abacus Group has continued to grow market share in the UK but, as previously reported, trading conditions have deteriorated in the current economic climate and show no signs of near term improvement.
In particular, delays have occurred in the calling-off of stock against a major contract in the Trident display business.
As a consequence, the board has taken certain steps to address the more difficult trading environment affecting the group.
The management team in Trident will be strengthened with the appointment of Tim Merricks as Operations Director.
He joins Trident from Nikon UK where he has been responsible for logistics and project management.
In addition, from 1st July, the Abacus operations in the Nordic region have been reorganised resulting in the closure of offices in Finland and an overall reduction of 30 staff in the Nordic region to 60.
The reorganisation costs of GBP 0.7 million will be treated as an exceptional charge in 2005.
A further exceptional charge will be recognised in 2005 relating to the introduction of the new Restrictions on Hazardous Substances (RoHS) legislation in the EU, effective from 1st July 2006.
The charge to be made in 2005 has not yet been fully quantified, but is likely to be approximately GBP 3.5 million, and represents the cost of writing off stock considered unsaleable due to noncompliance with RoHS.
No cash outflow is associated with this exceptional charge.
Finally, the board has reviewed the level of dividend to be paid by Abacus.
In order to restore dividend cover to a more robust position, the board proposes to declare a total dividend for the year of 7.2p (2004: 10.5p) of which 3.6p was paid at the interim.
The board considers this to be an appropriate revised dividend base on which future growth should be factored.
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