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For Immediate Release 14 December 2012
Trading Update and Board Appointments
Volex plc ('Volex' or together with its subsidiaries, the 'Company'), the global provider of electrical, digital and optical connections, today announces an update on trading.
Contrary to earlier expectations of growth in second half revenue, the Company has experienced a general softening of demand across all sectors as well as delays in specific project timelines, which does not include our largest customer. As a result, we anticipate our full year revenues for the year ending 31 March, 2013 will now be in the range of $470-$485 million. The full year normalised operating profit is now expected to be in the range of $11m to $14m.
At the interim results the Board announced three key initiatives to improve profitability; namely a significant reduction in operating expenditures, improvements to our Consumer gross margins and the realisation of new revenue pipeline:
· reductions in operating expenses actioned to date exceed the initial 10% target
· underlying Consumer gross margin improvements are on track
· revenue pipeline continues to grow, but conversion to revenues delayed
Given the reduced revenues, the Board has taken further decisive action and is:
· widening the scope of the cost reduction initiatives
· implementing programmes to better align the sales organisation with current and future customer needs
· strengthening the senior sales leadership and
· accelerating the Company's move to a higher margin product portfolio
Further to our announcement on the 10th December that Andrew Cherry will be leaving the Company, we are pleased to announce that Daniel Abrams will be joining the Company, as Group Finance Director and executive director of the Board on 17 December 2012.
Daniel has over twenty years' experience in senior financial and operational roles, primarily in the manufacturing and technology industries. Most recently, he was Group Finance Director with Fiberweb plc, an international manufacturer of specialist non-woven fabric technology from February 2008 to April 2012. Prior to joining Fiberweb, Daniel held a number of executive roles including Finance Director of Xenova plc from 1997 to 2005. His other executive roles have included Vice President & CFO South Asia & Africa Division for PepsiCo and Head of Corporate Finance & Strategy for Diageo plc.
Furthermore, Karen Slatford, currently a non-executive director of the Company, will assume the role of Deputy Chairman. Karen has extensive sales and marketing experience, having been Vice President and General Manager Worldwide Sales & Marketing for Hewlett Packard. In this new role, she will work with the Executive team to optimise the sales function and to build enhanced customer relationships.
There are no further disclosures pursuant to paragraphs 9.6.13(1) to 9.6.13(6) of the Listing Rules in relation to the appointment above.
For further information please contact:
Ray Walsh, Group Chief Executive +44 20 3370 8830
Andrew Cherry, Group Finance Director
Charles Ryland / Jeremy Garcia / Sophie McNulty +44 20 7466 5000
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