Supplier of light emitting diode (LED) solutions for industrial users. Applying leading edge LED technology, it produces retro-fittable lighting fixtures designed specifically for hazardous locations, obstruction signals and traffic signalling. I have a holding in my growth portfolio (epic code: DIA).
Dialight issued a trading update today which confirmed further weakening of their order intake and overall trade.
The Industrial Lighting division sales grew by 50% in the
year, which although an impressive number, was down on the 60% achieved at the 10 month stage. They state that this is due to the late receipt of almost £3m of Lighting orders, that will now be
delivered in 2014 and decisions by certain US customers in December to defer
Lighting orders.
They had previously commented on order delays for the Obstruction business during the
year, but there is now in
addition to this, a worse than expected performance from the Traffic business in both the USA and
Europe which was down £3m in revenues on the prior year.
Management say that they now expect
underlying PBT from continuing operations to be not less than £14.5m, compared to £19.7m last year. At today's price of 700p the stock is still rated on a P/E above 23, which would suggest that holders have not given up on the company just yet and 2013 may just be an isolated awful year.
My purchase in November was obviously poorly timed, but I still feel that the industrial LED market will support substantial growth, but some of the shine has been taken off the track record of Dialight and raises a few questions over the management of the business.
No comments:
Post a Comment