Trading Update

SDI Group plc, the AIM quoted group focused on the design and manufacture of scientific and technology products for use in digital imaging and sensing and control applications, is pleased to provide a trading update for the year ended 30 April 2024.

Financial results

Subject to finalisation of the accounts and audit, we expect revenues to be in line with current market expectations1 at approximately £65.9m (FY23: £67.6m). In addition to the acquired business Peak Sensors (November 2023) there was a full year's contribution from both LTE Scientific (acquired July 2022) and Fraser Anti-Static Techniques (acquired October 2022). Adjusted Operating Profit2 is expected to be in the region of £9.6m (FY23: £12.8m) with Adjusted Profit Before Tax2 approximately £8.0m (FY23: £11.8m), both in line with current market expectations1.

Business overview

As expected, the Group saw improved profitability and cash generation from operations over the second half of the financial year. As noted at the half year, Atik Cameras received a camera order from their major OEM customer in November which benefitted the second half of the financial year. Monmouth and Chell Instruments experienced a strong second half, with the former seeing increased clean room and cabinet sales, the latter seeing improved demand for its DAQ product range. Fraser Anti-Static Techniques also saw a pickup in revenues. Scientific Vacuum Services ("SVS"), as expected, saw a slower period of trading after delivering a large contract in the first half of the year.

Our focus on cash generation has yielded results with the net debt position maintained in the second half at £13.2m (31 Oct 23: £13.2m), despite £3.3m of cash outflow in the period for acquisitions (Peak Sensors: £2.3m, SVS earnout: £1.0m). Gross debt at the end of the year was £14.6m leaving £10.4m in headroom within our revolving credit facility, alongside an additional £5m accordion option with HSBC.

After a review, SDI disposed of Uniform Engineering for a nominal sum at the end of February 2024. This disposal resulted in a loss of £0.2m, which will be classified as a non-recurring item. Uniform had external revenues of £0.45m and recorded a small loss over the ten months to February 2024.

We continue to invest in our existing businesses and in acquiring complementary businesses and we expect to continue our buy and build strategy in FY25.

Ken Ford, Chairman of SDI, commented: "I am pleased to report that the Group had a good finish to the financial year, with better trading performances at a number of SDI businesses. Stephen Brown, our new CEO, has settled into his role well and is already making an impact. The Group's cash generation from operations improved over the second half which leaves us well placed to continue our buy and build strategy."

• Analysts from our Broker Cavendish Capital Markets Limited and from Progressive Equity Research regularly provide research on the Company, accessible from our website, and the Group considers the average of their forecasts to represent market expectations for FY24 being Revenue of £64.9m, Adjusted Operating Profit of £9.5m and Adjusted Profit Before Tax of £7.9m.
• Before reorganisation costs, acquisition costs, profit or loss on disposal of subsidiaries, amortisation of acquired intangibles and share based payment costs.