Oxford Instruments downbeat on full-year performance

Oxford Instruments, the London-listed tech company, which completed the acquisition of Belfast-based Andor Technology earlier this year, said it expected full-year performance at the lower end of market expectations, hurt by weak trading in the first half.

Oxford shares fell as much as 5.8 per cent on Tuesday morning, making them one of the top percentage losers on the FTSE Midcap index.

Revenue on an organic basis for the first half ended September 30th fell 5.9 per cent to £178.5 million, while pre-tax profit before adjustments fell 25 per cent to £15.4 million.

The first half was hit by a strong pound and weaker demand from Russia and Japan, the company said. Oxford gets only about 9 per cent of its total revenue from the UK.

Its Russia operations suffered due to political turmoil in the region, the impact of falling oil prices on Russian economy and a fall in the rouble, two top company executives said.

Sales from Russia plummeted 80 per cent in the first half, finance director Kevin Boyd said, adding that the country contributed 2 per cent to sales in the period compared with 5-6 per cent in previous years.

Its Japanese operations were hurt by a fall in orders due to lower spending on technology, chief executive Jonathan Flint said.

Japan accounted for 7 per cent of its first-half sales, down from 10 per cent a year earlier, Mr Boyd said.

Oxford Instruments, which makes maintenance systems and parts for CT and MRI scanners, said second-half results were expected to be ahead of a year earlier, helped by new products and improved economic conditions in the US and UK.

Organic orders from North America, its biggest market, rose 28.7 per cent in the first half, with strong demand for its tools used for securely coding financial transactions, Mr Flint said.

Its order book currently stood at £147.9 million, up from £123 milliona year earlier. Mr Flint said about 70 percent of the orders will be deliverable in the second half.

Oxford Instruments, which bought digital camera maker Andor Technology in December, will make smaller bolt-on acquisitions in the next two years, Mr Flint said.

The group declared an interim dividend of 3.7 pence per share, a rise from the 3.36 pence a year earlier.

Oxford shares were down 2.7 per cent in early trading on the London Stock Exchange.