Oxford Instruments reports good preliminary results, but Covid kick in teeth in last quarter

Oxford Instruments

Oxford Instruments plc, a leading provider of high technology products and systems for industry and research, which is based near Abingdon, has reported its preliminary results for the year ended March 31, 2020.

The company said that good progress underpinned a strong financial performance until the impact of covid-19 in its last quarter.

Trading disruption due to the pandemic equated to approximately two weeks’ equivalent revenue following deferred product shipments and installations in the last quarter.

Orders ticked up marginally by 0.3 per cent to £336.0m, a decrease of 1.3 per cent at constant currency; book to bill ratio of 1.06.

The company’s order book of £175 million was up just over 14 per cent.

Reported revenue increased by 1.1 per cent to £317.4 million.

Ian Barkshire, Chief Executive of Oxford Instruments plc, said: “We have made good progress in the year with the implementation of our Horizon strategy, which combined with our strong balance sheet continues to provide the foundation for long-term sustainable growth and margin improvement. We have positioned the Group to be a leading provider of high technology products and services to the world’s leading industrial customers and scientific research communities to image, analyse and manipulate materials down to the atomic and molecular level. This allows us to live up to our purpose of facilitating a greener economy, increased connectivity, improved health and leaps in scientific understanding.

“The coronavirus has continued to impact trading in the first two months of the year, with cumulative orders 3 per cent below a weak comparator period, and with growth in Asia of 19% offsetting a reduction in Europe and North America of 23 per cent and seven per cent respectively. A strong uplift in orders for our compound semiconductor process solutions has offset a reduction in orders for our higher-margin scientific cameras and optical microscopy products, which have been severely impacted by disruption across academic customers. Group revenue is three per cent above last year, assisted by delivery of shipments that were held over from the year end due to 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.

“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.

“Our strategy is to operate in attractive markets with long-term fundamental growth drivers and to focus on segments where we can maintain leadership positions. With the increasing demand for electric vehicles and digital communications infrastructure, and the need for improved energy‑efficient devices, medicines and diagnostic tools, we are confident that our end markets are resilient and should not be weakened in the long term by covid-19 headwinds.”