Amino predicts profit
December 6, 2011
Amino Technologies has provided an update on trading for the year ended 30 November 2011. The Company expects to deliver a profit for the year that is marginally ahead of market expectations (FY2010: loss of £0.9m). This is the result of the operational improvements highlighted at the time of the interim results and continued traction in the emerging OTT market. Revenues for the full year are expected to be well ahead of the previous year (FY 2010: £44.0m) albeit below market expectations, principally due to difficult trading conditions in the Eastern European and Russian IPTV markets.
Amino has successfully managed the supply chain issues which have affected the industry in the second half of the year. This sharp focus on operational management has driven continued margin improvement and proved critical in ensuring delivery of product to customers.
Orders received in FY 2011 totalled 546k units (FY 2010: 660k). The year-on-year reduction of orders received is the result of strong pricing pressure in Eastern Europe and structural changes in the Russian market. Importantly, however, the Company has seen a much improved performance in North America, where its new range of enhanced IPTV/OTT products has been well received.
Sales volumes of OTT products have also been encouraging, with further orders received from Telecom Italia during the second half of the year. The Company also continues to progress a number of trials in North America for its Amino Freedom OTT products. A new Western European contract to supply Vodafone Netherlands with IPTV/OTT set-top boxes has also been secured. At the year end, Amino has total scheduled orders of 102k units to be delivered in FY 2012.
The Company’s cash position during the period strengthened to £14.1 million (FY 2010: £3.6m) as a result of improved working capital management and profitability, and despite the share buyback in August 2011 totalling £1.2 million.
In line with the broader electronics industry, the Company anticipates challenging conditions for the supply of Hard Disc Drives (HDDs) into the first half of 2012 following the recent flooding in Thailand. HDDs are a key component for the Company’s PVR device range which accounts for approximately a third of forecasted FY 2012 sales. As noted above, the Company’s strong supply chain relationships and controls enabled it to secure additional HDDs to fulfil FY 2011 orders. With rising prices and availability issues, the outlook remains uncertain for the market as a whole. Whilst this could potentially affect Amino’s sales mix and cause some short term margin disruption the Company believes that, at this time, it can continue to meet the Board’s expectations for the year ahead.
The Company will announce results for the twelve months ended 30 November 2011 on 13 February 2012.