Synectics delivers strong interim performance as revenue and profits soar
() , a provider of security and surveillance systems, released its interim results for the 6 months to May 31, 2024 (H1 2024).
Synectics reported a revenue increase of 20% to £26.3m, compared to £21.9m in H1 2023. Underlying operating profit nearly tripled to £2.2m from last year's £0.8m, and underlying EBITDA jumped by 67% to £2.8m.
Likewise, underlying EPS soared by 170% to 10.0p from 3.7p a year ago. Net cash was up to £6.4m on May 31, 2024 with no bank debt, compared to £28.4m on May 31, 2023. Synectics' orderbook grew to £30.2m as of May 31, 2024 from £28.4m LY, and the group reinstated an interim dividend at 2.0p/share.
Post-period, signed a large US$10m contract for a "high-profile Asian gaming resort" announced in June 2024 and expected to be delivered in FY25. Boosted by its growing orderbook and strong interim performance, the group expressed confidence in meeting market expectations for FY24.
Paul Webb, CEO, commenting on the results: "We're delighted to have delivered a strong H1 2024 performance, driven by our Systems division completing delivery of several projects ahead of schedule.
Our robust order book and promising pipeline of new business opportunities, coupled with our reputation as a trusted partner, ideally position us to capitalise on exciting opportunities across our growing specialist end markets.
Against this positive backdrop, the Board remains confident in meeting market expectations for FY 2024* and the Company's longer-term prospects."
View from Vox
Excellent interim results from Synectics with significant 20% revenue growth, resulting in a near tripling of underlying operating profit to £2.2m, while gross profit increased by 23% to £11.2m. The robust performance in H1 resulted from a strong opening orderbook and the early delivery of several high-margin projects by 's Systems division.
On the back of strong momentum in its core markets with new investment and renewal of existing systems, expects H2 performance to be similarly strong and FY24 to be more evenly weighted than prior years. The group expects FY24 to be comfortably in line with market expectations.
Synectics ended the period with an increased orderbook of £30.2m and strong intake across all markets. A robust net cash position of £6.4m and a large US$10m contract announced in June 2024 further support market expectations for FY25. Encouraged by the substantially improved profitability during the period, reinstated an interim dividend of 2.0p/share to be paid on August 23, 2024 - the first interim dividend since FY19.
Overall, continued strong margins across both divisions, a strong orderbook and pipeline of new opportunities, and a robust cash position with no debt, support a positive medium-term outlook for .
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