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  • BY: Andrew Hore |
  • POSTED: 08/10/2009 |

Interim revenues fell by more than one-quarter at electrical and engineered products supplier Elektron.

Revenues fell from 19.4m to 14.2m in the six months to July 2009. Gross margins improved and admin expenses were reduced, which helped to reduce the effect of the revenue decline on profits. A profit of 101,000 was turned into a loss of 388,000. Excluding exceptional charges, the profit declined from 706,000 to 170,000.

The downturn is not a surprise because Elektron is dependent on the health of the manufacturing sector. The electrical components division was the one part of the group that remained profitable. Orders from China were 24% higher. Management believes that the cutting tools operations will see a gradual improvement in their markets.  The instrumentation division will benefit from new product launches in the fourth quarter.

There are signs of improvement but confidence is still fragile.

Net debt was 3.18m at the end of July 2009.

House broker FinnCap forecasts a very small profit in the year to January 2010.

At 8.625p a share, Elektron is valued at 7.69m. 

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