MTI Wireless Edge reports 'good' first half trading
Communications and radio frequency technology company MTI Wireless Edge reported good first-half revenue growth on Monday, up 6% to $22.7m.
The AIM-traded firm said its profit from operations in the six months ended 30 June was ahead 1% year-on-year to $2.19m.
In the half-year, the company incurred one-off acquisition costs of $0.1m, and depreciation of intangible asset charges relating to the acquisition of $0.1m, with the depreciation charge set to be 50% lower from 2023 onwards.
EBITDA grew 11% to $2.9m, with all three of MTI’s divisions contributing positively.
Earnings per share slipped 3% to 0.183 US cents, which the board put down to increased finance costs relating to weakness of the euro and sterling against the dollar, as some of its net cash was held in those currencies.
It said its balance sheet remained “strong”, with net cash of $5.2m as at 30 June, down from $9.7m a year earlier but after the payment of the 2021 dividend of 2.8 cents per share on 31 March, the divestment of its Russian business in March, the acquisition of 51% of PSK, and providing working capital loans to that acquisition.
Cash flow from operations was “flat”, which the directors said reflected the firm’s use of its “strong” balance sheet with some vendors, and PSK's longer debtor terms.
“This has been a good trading period for the group, with all divisions making operational profits,” said chief executive officer Moni Borovitz.
“In the context of the challenging trading conditions we have faced, including the rising inflation and the difficulties in the supply chain - shortage in supply of microchips and shipping costs, which are delaying the delivery of certain orders - the board is very pleased with the results.”
Borovitz said there were some signs of the supply chain issues easing, adding that the company had a “healthy” order book going into the second half and beyond.
“We have been able to successfully put through a number of price increases which will ensure we can maintain our target profit margins. As a result, we feel confident about the outcome for the full year.”
At 1139 BST, shares in MTI Wireless Edge were down 4.33% at 57.88p.
Reporting by Josh White at Sharecast.com.