Redditch-based computing and power products manufacturer Solid State plc, says it expects to announce results ahead of its recently upgraded consensus forecasts. The final month of the financial year benefitted from demand pulled forward and a strong contribution from the two businesses acquired at the end of February. Trading since the update announced on 22 February 2021 has continued to be encouraging, with stable order flow and strong invoiced sales in the month of March, driven in part by certain component shortages and customer stocking to mitigate supply chain risks.
Demand across the Group has generally been strong with gross margins holding up.
Gary Marsh, Chief Executive at Solid State said: “The outcome for the full year represents an excellent achievement for the Group, given that notwithstanding the disruptions of COVID and the Brexit uncertainty, the performance exceeded the prior year, which was itself a record year.
“Despite the residual market uncertainty and ongoing related supply chain constraints, the organic growth opportunities in our target structural growth markets provide an encouraging foundation for the future growth prospects of the Group.”
The acquisitions of Buckinghamshire-based Active Silicon and Sussex-based Willow Technologies Groups have integrated well so far. The commercial synergies between the acquisitions and Solid State are increasingly being realised, with exciting prospects being advanced.
The Group continues its programme of investment in engineering capability and improvement in production efficiency to enhance the development of services to customers, own brand products and margin opportunities.
The open order book on 31 March 2021 was £41.3 million, which includes the open order books from its recent acquisitions. On a like for like basis, the order book on 31 March 2021 was £33.7 million (31 March 2020: £39.9m).
Market conditions across the electronics industry are expected to be impacted by supply chain challenges and component shortages for several months, and customers have been encouraged to pay increased attention to forecasting and adequacy of forward order cover.