Synectics trades in line despite 'slower' security progress

Security and surveillance technology company Synectics said in an update on Wednesday that trading in its first quarter was in line with the board's expectations.

The AIM-traded firm, which was holding its annual general meeting, said its systems division started the financial year “slightly ahead” of the board's expectations, mainly as a result of an improved contribution from public space and infrastructure security systems in the UK, including the National Grid contract which was announced recently, and also “encouraging progress” in global oil and gas markets.

Chairman David Coghlan said that, while the security division had a “slower start” to the financial year with several projects experiencing client-driven delays, they were expected to be recovered later in the financial year.

The company said its consolidated order book as at 31 March was £29m, up from £28.4m at the end of November, with the group's balance showing net cash of £3.9m, down from £4.6m.

“Activity in Synectics' main regional markets has continued the pattern shown in the second half of the last financial year with continued modest recovery in the UK and Europe, the pipeline of expected orders in North America progressing steadily, and Asian markets remaining subdued, but with some evidence that these look likely to turn by early next year,” David Coghlan told shareholders.

“These trends underpin the board's continued expectations for a solid improvement in trading results across this year, particularly in the second half.”

Synectics said it would further update the market on its current trading and prospects in June, following the end of its first half.

At 1142 BST, shares in Synectics were down 8.44% at 114.45p.