Solid State reports drop in first-half revenues, cites Brexit impact

Solid State saw its topline shrink in the first half of its financial year, with management saying that the uncertainty following Brexit impacted on clients´ buying patterns.

"While the broader economy continues to encourage prudence in clients' buying patterns following the results of the EU referendum, we have maintained a strong order backlog of £14.8m as at 30 September 2016," the chairman, Tony Frere, said in a statement.

Nevertheless, the manufacturer and specialist design-in distributor to the electronics industry pointed to its stronger order backlog of £14.8m as at period-end, on 30 September, as evidence of its resilience.

Frere also highlighted the benefits of the group´s product mix and the typically long-term nature of its client relationships, as well as a supportive bank which "enables the Group to confidently pursue future growth initiatives and acquisitions".

AIM-listed Solid State serves various markets, including: Aerospace, Environmental, Government, Industrial, Medical, and the Oil&Gas and Transportation markets.

During the first half of its financial year the company saw revenues decline 9.0% to reach £20.09m, despite which profits before tax rose 10% to £1.64m, helped by a 350 basis point improvement in its gross profit margins.

Its dividend cover also improved, falling 7% to 4.2 times.

"The Board is optimistic about Solid State's prospects," Frere concluded.