Synectics reports strong set of first-half results

(Sharecast News) - Security and surveillance system specialist Synectics reported a strong set of unaudited interim results on Tuesday, with a 20% rise in revenue, reaching £26.3m compared to £21.9m in the first six months of 2023. The AIM-traded firm said underlying operating profit surged 183% to £2.2m from £0.8m, while underlying EBITDA rose 67% to £2.8m from £1.7m.

Underlying earnings per share increased 170% to 10p, up from 3.7p in the same period last year.

The company maintained a strong financial position with net cash of £6.4m and no bank debt as of 31 May - an improvement from £4m a year earlier.

The order book also grew, standing at £30.2m compared to £28.4m at the end of May last year.

Reflecting its strong performance, Synectics reinstated its interim dividend at 2p per share.

Operationally, Synectics said it benefited from the early delivery of several projects by its systems division.

The board said it expected financial performance for 2024 to be more evenly weighted and in line with market expectations.

It said it was continuing to see momentum across its core specialist markets, with investments in new projects and renewals of existing systems.

The board added that a robust order book and a solid pipeline of new opportunities underpinned its confidence for continued progress.

Since the period ended, Synectics announced a significant $10m contract for a high-profile Asian gaming resort, expected to be delivered in the 2025 financial year.

The appointment of Bob Holt OBE as non-executive chair in April and Jon Kempster as an independent non-executive director and chair of the audit committee in July had further strengthened the board.

"We're delighted to have delivered a strong first-half performance, driven by our Systems division completing delivery of several projects ahead of schedule," said chief executive officer Paul Webb.

"Our robust order book and promising pipeline of new business opportunities, coupled with our reputation as a trusted partner, ideally position us to capitalise on exciting opportunities across our growing specialist end markets.

"Against this positive backdrop, the board remains confident in meeting market expectations for the 2024 financial year, and the company's longer-term prospects."

At 1127 BST, shares in Synectics were flat at 185p.

Reporting by Josh White for Sharecast.com.