XP Power, one of the world's leading developers and manufacturers of critical power control components for the electronics industry, is today issuing a trading update for the fourth quarter ended 31 December 2017.
The Company had a good finish to the year, in line with the Board's expectations, as the strong order intake reported in the third quarter drove robust revenue growth in the final quarter. Encouragingly, the momentum in order intake continued into the fourth quarter and geographically, both order intake and revenue growth has been strong across all regions.
Order intake in the fourth quarter of 2017 was £46.8 million, 24% ahead of Q4 2016 on a reported basis or 32% ahead in constant currency. This resulted in order intake for the twelve months ended 31 December 2017 being £184.3 million, an increase of 38% over 2016 on a reported basis, or 31% in constant currency.
Revenue in the fourth quarter of 2017 was £43.2 million, 16% ahead of Q4 2016 on a reported basis, or 23% in constant currency. Revenue for the twelve months ended 31 December 2017 was £167.0 million, an increase of 29% over 2016, or 22% in constant currency.
The trading performance of Comdel was in line with the Board’s pre-acquisition expectations, with orders in the fourth quarter of £5.8m, 101% ahead of Q4 2016 on a reported basis, or 114% in constant currency. Comdel reported fourth quarter revenue of £4.1m, 30% ahead of Q4 2016 on a reported basis, or 30% in constant currency. Integration of the Comdel business into XP Power is proceeding as planned. Orders and revenue for 2017 represent a full year book to bill ratio of 1.11 (2016: 1.03) reflecting the strength of customer demand across the year.
Following the acquisition of Comdel on 29 September 2017 for US$23.0 million (£17.0 million), net debt at 31 December 2017 was £10.1 million, compared with a net cash position of £3.6 million at 31 December 2016.
A dividend of 18 pence per share for the third quarter was paid on 11 January 2018, to shareholders on the register at 15 December 2017.
The recommended dividend for the fourth quarter of 2017 will be announced with the 2017 final results on 1 March 2018 but is not expected to be less than 28 pence per share, representing a minimum total dividend of 77 pence per share for 2017, an increase of 8% over the total dividend of 71 pence per share paid for 2016.
We are encouraged by the continued strong order intake experienced across the business during the second half of 2017 and the overall book to bill level for the year. We enter 2018 with positive momentum and therefore expect to grow orders and revenue in 2018 above that in 2017.
Duncan Penny, Chief Executive
Gavin Griggs, Chief Financial Officer
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Note to editors
XP designs and manufactures power controllers, the essential sub assembly in every piece of electrical equipment that converts the power from the electricity grid into the right form for the equipment to function. XP typically designs in power control solutions into the end products of major blue chip OEMs, with a focus on the industrial (circa 45% of sales), healthcare (circa 30% sales) and technology (circa 25% of sales) sectors. Once designed into a program, XP has a revenue annuity over the life cycle of the customer's product which is typically 5 to 7 years depending on the industry sector. XP has invested in research and development and its own manufacturing facilities in China, North America and Vietnam, to develop a range of up to date products based on its own intellectual property that provide its customers with significantly improved functionality and efficiency. Headquartered in Singapore and listed on the Main Market of the London Stock Exchange since 2000, XP serves a global blue chip customer base from 27 locations in Asia, Europe and North America.