Synnovia's film division plagued with 'teething problems'

Manufacturer Synnovia told investors on Tuesday that it expects to trade broadly in line with market expectations in its current trading year after some delays and teething problems.

Synnovia revealed continued strong growth to its revenues but noted that it had yet to translate into the growth in profits that it had expected, in part due to its ongoing hedging policy.

The AIM-listed group also singled out cost pressures and "unforeseen minor delays" to the addition of new capacity in its films wing.

Despite the delays, Synnovia said both its film and industrials divisions had continued to perform well and that demand had been high.

Chairman Faisal Rahmatallah said: "We continue to implement a programme which adds capacity to fulfil this demand and to enable future growth thereafter.

"Relatively small delays to this programme have been experienced in the films division and will restrict profit growth in the current financial year."

Rahmatallah added that, except for this "disappointment", he was "satisfied" with the company's progress.

"Overall, we anticipate that our financial performance over the second half of the financial year will enable us to announce results that are broadly in line with market expectations."

As of 1025 GMT, Synnovia shares had slumped 10.27% to 99.60p.