TT Electronics profit plunges

Shares of electronic component and sensor technology firm TT Electronics plummeted after it revealed a sharp decline in half year pre-tax profit.

The Surrey-based group, which supplies electronic components to manufacturers in the automotive, defence, aerospace and medical industries, said pre-tax profit plunged to £12.5m for the six months ended 30 June 2012 from £20.8m before as the uncertain macroeconomic environment continues to hurt demand at its key electronics components unit.

Profit before taxation and exceptional items was unchanged at £13.3m while revenue fell to £271.2m from £281.8m the same time a year earlier. Operating profit slipped to £15.1m during the period from £15.2m previously.

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Chief Executive Geraint Anderson commented: "We have continued to make progress reducing our cost base with key projects delivered ahead of plan, and additional programmes now underway."

"These activities, together with an improving product mix, will deliver further margin growth in a more challenging market environment in the second half. Our global strength has positioned us well with both emerging key accounts and traditional customers, and we have won several major new contracts," it added.

Headline earnings per share rose to 6.0p from 5.7p.

On a brighter note, TT Electronics underlined its confidence in future trading by boosting its dividend payment by a quarter. A dividend payment of 1.5p per share has been offered, up from 1.2p the year before.

Net debt reduced to £7.3m from £24.2m a year earlier.

CJ