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January 28, 1997updated 05 Sep 2016 12:45pm

FALLEN HIGH-FLYER FILTRONIK COMTEK SAYS THINGS ARE IMPROVING

By CBR Staff Writer

Despite plummeting net profits that fell 99.9% in the first half, Filtronic Comtek Plc is confident that it will meet its budget for the year. The six months results to November 30 showed a 12.6% increase in revenue to 17.1m British pounds, with pre-tax profits falling 99.3% to 15,000 pounds. The company blamed its disappointing figures on poor performance in the US in the first quarter. The Shipley, UK-based manufacturer of subsystems for cellular telephone network base-stations says it has experienced short-term difficulties following delays in the roll-out of Personal Communications Services networks in the US, but second quarter figures indicate that the company is back on track and likely to meet its sales requirements for the year. First quarter US figures showed a loss of $1.8m, with sales totaling $3.5m. By the second quarter sales amounted to $9m, with a profit of $1m being recorded. Problems arose when a bug was overlooked by the company’s technical experts, delaying delivery times. Chris Schofield, company secretary said that Filtronic Comtek’s position is now improving, having more orders than we can handle. The UK operation has strengthened its position as a Radio Frequency supplier to the Groupe Speciale Mobile and Personal Communications Network systems of Motorola Inc, Nokia Oy and the Northern Telecom Ltd Matra SA joint venture. The Australian side of the business has exceeded expectation and is continuing to grow. The company is aiming to achieve sales of $25m before it reports its end of year results in May, 80% of which has already been accounted for in orders. Filtronic Comtek went public and floated on the London Stock Exchange in October 1994 in an attempt to raise 24m pounds for the expansion of the business. Figures were promising until results were published for the second half in 1996 when the share prices, which had been rising steadily, fell 15 pence to 230 pence as pre-tax profits decreased by 1%. In an attempt to increase the efficiency of the company a number of internal structuring changes have been made, including the appointment of a new chief executive, Dr Gregory Hey-Shipton, a US citizen born in the UK. Executive chairman Professor J D Rhodes says that second quarter figures showed an increase on the first quarter, and believes Filtronic Comtec is in a strong position to increase growth throughout 1997. The company will pay an interim dividend of 0.25 pence, a 67% cut.

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