AGM Statement
June 17 2009 - 7:19AM
UK Regulatory
TIDMDSN
RNS Number : 0492U
Densitron Technologies PLC
17 June 2009
Densitron Technologies plc
Trading update and result of AGM
Densitron Technologies plc ("Densitron" or the "Company" or the
"Group") announces that, at the Company's annual general meeting held earlier
today, all of the resolutions proposed to shareholders were duly passed and
today provides an update on its trading activities.
In the Annual Report the board indicated that 2009 would be a challenging year
for many businesses and this has proved to be the case. Densitron has not been
immune to the global economic downturn, however the directors remain confident
that the Company is well positioned to come through the present challenges and
capitalize on opportunities as the economies around the world recover.
A summary of the performance of Densitron's trading division and an update on
the two investments owned by the Group is as follows:
Operations
In the first five months of the year sales have been helped by the strong
orderbook brought into 2009 and are only marginally behind the first five months
of 2008 while gross profit is marginally ahead of the same period in 2008.
Orders booked have been affected by the current recession and during the first
five months are down on the same period in 2008. The main reason for the
reduction in the orderbook is the lack of orders received from the existing
Customer base and is primarily due to higher levels of inventory resulting in a
reduction in required orders. The board expects that there will be
further orders placed by these Customers in the second half of the year and
emphasises that no customers have been lost and that the current reduced order
level is a result of the slowdown in their businesses and not a reflection on
the Company's performance.
Expenses are higher than in the first five months of 2008, although in line with
budget, reflecting the investments made during the second half of 2008 to
develop future business. While the Company budgeted to make a loss in the first
half of 2009 it is anticipated that this loss will be greater than budgeted for
but the directors remain confident that the Company will be profitable in the
second half of the year.
With the lead time between orders being taken and delivered the Company has been
able to assess its level of overheads against the business being forecasted and
thereby make the necessary cost savings. This has enabled the Company to bring
overheads down without jeopardising the current opportunities pipeline and
future growth prospects. The board expect to see the major impact of these cost
savings in the second half of the year.
Despite the difficulties encountered over the last six months certain areas of
the business have been able to outperform the market and business in France and
Japan has been particularly strong. The UK and Germany have strong pipelines of
new business that the directors expect to be booked over the next couple of
months which will help underpin not only the recovery in the second half but
also growth in 2010.
The Company continues to pursue new business opportunities particularly in the
areas of advanced display products, touchscreens and customized displays. More
information about these products is available on the Company's website. In
addition the Company has continued to strengthen its distribution base by
signing new distribution agreements in the Netherlands and Slovenia.
Land at Blackheath
Having completed the necessary surveys and outline plans for the land at
Blackheath the Company appointed a property consultant to advise on how best to
proceed. Their advice is to promote the land for re-designation from
Metropolitan Open Land through the newly formed Local Development Framework. It
is believed that the process for consideration and re-designation will take 18
months with a decision expected in the first half of 2011.
Evervision Electronics Limited
Evervision, the Company's investment in a Taiwanese display
manufacturer, rationalized its operations prior to the current economic downturn
and as such has seen less impact than other Taiwanese manufacturers. It
continues to be significantly cash rich and the Directors continue to work on
ways to provide a return on the investment.
Outlook
The Company previously reported that following the disposals of certain loss
making operations, a three year plan for growth was put in place and that 2008
was the first of the three years. Having achieved the targets of the first of
the three years the business was set up to build on these achievements and grow
further in 2009. The result of the economic downturn has, however, meant that
the second year target will not be achievable but the long term prospects of the
business remain strong. With the Team we have in place we are convinced this
will give the Company the best chance of attaining sustained and long term
growth.
Enquiries:
+------------------------------------+------------------------------------+
| Densitron | HansonWesthouse |
| Grahame Falconer / Tim Pearson | Tim Metcalfe / Martin Davison |
| Tel: 0207 648 4200 | Tel: 020 7601 6100 |
| | |
+------------------------------------+------------------------------------+
This information is provided by RNS
The company news service from the London Stock Exchange
END
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