Spirent announces special dividend after improving profits

IT firm Spirent Communications chose to reward shareholders with a special dividend on Thursday after the West Sussex-based group saw profits grow 27% in its most recent fiscal year.

Spirent witnessed adjusted operating profits expand 27% to $58.9m, despite revenues falling back 5.07% to $454.8m.

The company attributed the improved performance to "materially reducing costs and focusing on our core areas of differentiation, returning to solid profitability" and announced a $0.05 special dividend on top of its increased full-year payout of $4.08 per share, up from the previous year's figure of $3.89.

Strong growth in Spirent's positioning and application security businesses offset some softness in high-speed Ethernet testing as customers transition to new 400G platforms at the same time as the firm increased the coverage of its flagship security product, Spirent CyberFlood, with support for ransomware, Internet of Things, industrial controls and distributed denial of service attacks.

Pre-tax profits for the year ended 31 December came in at $46.6m, a marked turnaround from the previous year's $46m loss.

Eric Hutchinson, Spirent's chief executive officer, said, "In 2017 we established a firm basis to realise Spirent's full potential delivering strong growth in earnings and in cash generation as we did so. We have taken our expertise in network assurance to deploy innovative new systems, winning new business with well-established and new customers. In doing so, we gained market share with the early adopters in the industry, which should serve Spirent well in 2018 and the long-term."

"Exponential growth in data and the virtualisation of networks continues at pace. We are well positioned for future growth with our leading-edge technology, to enable our customers to accelerate their time to market and increase their quality of service at lower operating costs," he added.

As of 1040 GMT, shares had advanced 10.85% to 120.60p.