Zytronic warns of persistent cost challenges through second half

18th Aug 2022 13:35

(Sharecast News) - Touch sensor manufacturer Zytronic updated the market on its trading on Thursday, reporting that the availability and cost of both raw materials and electronic components remained "persistent challenges" in the second half.

The AIM-traded firm said that was having a knock-on effect on its customers, and resulted in a lower-than-anticipated order intake over the second half of the 12 months ending 30 September to-date.

As a result, and with "clearer visibility" on revenue generation for the rest of the fiscal year, Zytronic said it currently considered that reported revenues for the 2022 financial period were likely to be about 5% higher than the £11.7m reported for 2021.

Additionally, and although it was still a "fluid consideration", profitability for the year was expected to be ahead of what it reported at the pre-tax level for the prior year.

"Whilst global and national economic uncertainties appear likely to continue beyond the year end, sales and marketing activities are resuming after a near two-year hiatus," Zytronic said in its statement.

"Working capital expansion is expected to continue in parallel with this resumption of activity and in response to the current operating environment."

The group expected to maintain a "healthy" cash balance at year-end of around £6m.

"With an improving log of opportunities and the ability to commit further resources to business development and project progression activities, management remains confident in the positioning, ongoing recovery, and longer-term growth prospects for the group."

At 1256 BST, shares in Zytronic were down 5.26% at 135p.

Reporting by Josh White at Sharecast.com.