LPA Group posts record results for 2016

LED lighting and electro-mechanical system manufacturer and distributor LPA Group announced record results for the year to 30 September on Monday, with continuing strong performance in the start to the current financial year.

The AIM-traded company reported sales up 31.7% during the year, at £21.42m, with operating profit before exceptional items improving 427% to £1.533m.

There was also an exceptional gain £14,000, compared to the £545,000 in 2015.

Profit before tax reached £1.516m, almost double the £793,000 reported in 2015, which included the large exceptional gain that year.

Basic earnings per share were 12.30p, lifting from 5.86p.

At year-end, LPA reported a gearing of 29.2%, compared to 34.0% in the prior year, and an order entry of £20.69m, down from £26.77m.

The company’s order book stood at £17.96m, slightly less than the £18.69m at the end of 2015.

LPA’s board said it achieved a “step-change” in performance during the year, and was moving onto a “new level” as it continued to benefit from a buoyant UK rail sector and export markets.

Its ethernet backbone technology and USB charging sockets were also continuing to generate “great interest” for both new build and retrofit applications.

The firm’s new LED lighting facility was nearing completion for occupation in the first quarter of 2017.

Finally, the board increased its final dividend by 50% to 1.50p, taking the total for the year to 2.50p - improving from 1.70p in the 2015 financial year.

“The financial year ended 30 September marked a step change in the performance of the Group, which is becoming established at this new substantially increased level of activity,” said chief executive Peter Pollock.

“Having 'galloped' up to a new level, we are now 'moving on'.”

Pollock claimed profits would have been even higher, but for an oil and gas sector customer being placed into administration after the year end, and a consequent provision of £124,000 being made against the results for the year.

“The customer's business was subsequently sold to a third party and trading is expected to resume in due course.

“After very strong order entry in the first half, the uncertainty of Brexit made customers relatively cautious in placing orders during the period from April to August, since when the high levels of order entry have resumed.”

Pollock added that sales and orders in the first quarter were ahead of the prior year, which he believed confirmed the continuing growth potential of the business.

“We look forward to continuing progress this year and for the future.”