Elektron Technology revenue down amid cloudy trading

Elektron Technology updated the market on its financial year to 31 January on Monday, ahead of its full results, and saw muted revenue across its divisions amid a cloudy trading environment.

The AIM-traded global technology group said group revenue from continuing operations amounted to an unaudited £43.5m, down 2% from 2015's £44.4m, with revenue in the second half of £22m.

Elektron said higher-margin sales from its growth business, combined with further improvements in efficiency, have led to an aggregate trading performance for existing businesses comfortably ahead of last year.

That was despite continued erosion of sales in a number of the low growth brands, the company's board said.

"Our new product development activity in our targeted growth brands resulted in pleasing sales growth in these areas during the year," said Elektron chief executive John Wilson.

"This, together with our continued focus on efficiency, has delivered improved performance from our businesses. Checkit is already generating significant opportunities and plans for pilot projects with a range of substantial users are at an advanced stage," he added.

Net debt at 31 January was £1.6m, down from last year's £2.7m, though it was marginally higher than the £1.5m net debt figure at the end of the third quarter as forecast in November.

Elektron's board was continuing to be cautious due to macro-economic condition which were having some impact on demand. It was also wary of the fact its visibility was limited by its order book, which had a maximum duration of five to seven weeks.

The board made the commitment that it would continue to invest substantially all of its operating cash flow into new product development, particularly new firm Checkit, as it had in the previous year.