Lower signal sales, extra costs to weigh on Dialight

11th Jun 2013 07:49

Dialight warned that first half profit will be adversely affected by weaker sales in the Signals segment and additional costs from the planned extra sales in the Lighting segment but it reassured that full year results remains broadly in line with forecasts.The lighting, signalling and electronics group said that Lighting segment revenues will exceed the previously indicated growth of 50% compared to the first half of 2012 and expectations for the full year are that Lighting revenues will again exceed 50% growth.As indicated in April, its Signals division was trading behind the first half of 2012 due to the expected run off of a large cellphone tower customer contract, high sales into the US wind market in 2012 and the delay in the award of a significant new contract for obstruction. Dialight added that while it is now well positioned to take advantage of new opportunities, following its decision to sell directly to the cellphone tower market rather than through value added resellers, timing on the rollout of these new integrated system contracts remains difficult to predict. As a result of these issues, sales in the Signals segment are expected to be down in the first half of 2013. Despite this, the group said it remains confident in the longer term recovery of the obstruction product line."However, as the group's financial results have, in recent years, been weighted towards the second half and some recovery in obstruction is anticipated, the Board continue to consider that the group will deliver results broadly in line with expectations for the full year ending 31 December 2013," it said. Shares of Dialight sank nearly 10% to 1,210.00p at 08:30 in London.CJ