Xaar sales 'in line with expectations'
Wednesday, January 13, 2016
Year-end sales at Xaar are anticipated to be in line with expectations, although its operating margin is likely to fall to around 20%.
In a trading statement released today (13 January), the Cambridge-headquartered inkjet developer said turnover for the year ended 31 December 2015 is likely to be down 14.4% at approximately £93.5m (2014: £109.2m), an increase on the £90m previously predicted.
The company said sales have performed in line with expectations since the last trading statement on 4 November 2015.
Revenue growth in packaging has been offset by the anticipated softening in demand in the Chinese ceramic tile printing market, which had accounted for two thirds of the group’s sales prior to a dramatic fall-off in demand in 2014.
The group expects to report an adjusted operating margin for 2015 of approximately 20% (down from 22.2% in 2014).
It said it has improved operating efficiency at both its Huntingdon and Järfälla, Sweden manufacturing sites. The Sweden site is due to close midway through 2016, but Xaar told PrintWeek it completed production of some products at the site in the second half of 2015, which helped margins.
The group, which also reported net cash at 31 December 2015 of £70m (30 June 2015: £59m), had already said that 2015 would be a “stabilisation” year, with a return to growth predicted for 2016.
Xaar expects to release its preliminary results for 2015 on 16 March. The company's share price rose by 24.8p to 475.8p in early trading (52-week high: 566.5p; low: 282.5p).
Separately, the company announced last week that it had boosted its 3D printing know-how with the appointment of Professor Neil Hopkinson for its growing 3D operation, and plans to set up a specialist “world-class” team for 3D.
This followed the appointment of former Stratasys and HP executive Chris Morgan as a non-executive director in December.