Interim revenues declined at consumer electronics and in-car entertainment products supplier Armour Group but it remains profitable.
Revenues dipped from £30.2m to £26.7m in the six months to February 2009. Both the automotive and consumer divisions produced lower revenues. Pre-tax profit slumped from £2.58m to £731,000.
Sales in the automotive manufacturer market were hit by lower production volumes. One of the stronger sectors has been the agricultural vehicles market. Armour supplies four of the six biggest tractor manufacturers.
The consumer division has started generating revenues from supplying hotels. The TV stands and furniture business is still strong and Armour is moving into office furniture for small businesses.
Net debt was £7.22m at the end of February 2009 because stocks and debtors were lower. The net debt figure will be nearer to £9m at the year end as the company builds up its stocks for the autumn.
This has led to a profit downgrade from FinnCap. The 2008-09 profit forecast has been cut from £1.5m to £1m.
At 9.5p a share, Armour is valued at £6.51m. The shares are trading on less than nine times 2008-09 prospective earnings, falling to five times 2009-10 forecast earnings.
The market remains tough but new product launches will help.
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