Oxford Instruments defers dividend decision as orders drop

Oxford Instruments deferred a decision on its dividend after the Covid-19 crisis hit orders in the first two months of the current year.

Adjusted pretax profit for the year to the end of March rose 8.8% to £49.5m as revenue rose 1.1% to £317.4m. Statutory pretax profit rose 13.1% to £38.8m.

In March the maker of microscopes and other scientific and industrial equipment suspended its interim dividend, scheduled for payment in April, to conserve cash during the coronavirus crisis. The FTSE 250 company paid no dividend for the year to the end of March.

Gavin Hill, finance director, said: "As a result of continued uncertainty, the board will defer a decision on payment of dividends until we have fully assessed the outcome of disruption caused by Covid-19 on our markets and trading performance."

The company said Covid-19 had affected trading in the first two months of 2020-21 with orders 3% less than a weak period a year earlier.

Demand for compound semiconductor process products rose but orders for higher-margin scientific cameras and microscopes were severely hit by the closure of universities. Revenue rose 3% in April and May, helped by deliveries of orders held over from last year because of Covid-19.

"We have an active pipeline of sales opportunities, reinforced by our digital marketing and online sales presence, but activity levels within academic institutions remain low due to continued customer site closures," Ian Barkshire, Oxford Instruments' chief executive, said

"It will take some time to understand the impact and longevity of this disruption, and we will continue to take measures to adapt and protect our business throughout this period. Once we have attained an improved level of visibility, we will be in a position to provide guidance on the current year's expected financial outcomes."