Zytronic's (ZYT) half-year results have added a bit more detail to the profit warning issued by the touch sensor manufacturer. The shares plunged by a third when the company first revealed that revenues for the first half would come in at £9.5m – down by a tenth year on year – with pre-tax profits down by more than a third, to £1.4m.
The problems are due to a decline in sales to the gaming sector, which has been only partially offset by better performances elsewhere. And, looking ahead to the second half – which is typically stronger than the first – Zytronic remains cautious on the level and timing of a recovery in gaming.
In the six months, gaming revenues fell by 26 per cent to £3.1m, while sales to sectors such as financial, vending and signage rose by 11 per cent to £5.1m. Given the drop in sales, it is of some concern that year-on-year stock levels rose by almost a third, or £1m, contributing to a drop in net cash from £14.6m to £12.1m. The half-year dividend was maintained at 7.6p.
