Record order intake and a return to profit at its Systems arm have pushed the high-performance computing group to lift its full-year guidance.
Concurrent Technologies (AIM: CNC) saw its shares rise around 4% after the high-performance computing specialist posted record first-half results and told investors it now expects full-year revenue to come in materially ahead of market expectations. Revenue for the six months to 30 June rose 10% to £23.2m, pre-tax profit climbed 19% to £3.2m and EBITDA was up 20%, while cash stood at £9.7m at the period end.
The share price reaction was driven chiefly by a surge in order intake, which more than doubled, up 110% to £46.9m, already exceeding the whole of last year's total, aided by a record single contract win. Investors also welcomed the turnaround at the company's Systems division, which swung into profit for the first time as gross margin improved sharply to 26.3% from 13.3% a year earlier.
Chief executive Miles Adcock said the progress of the Systems business was 'particularly encouraging', crediting the September 2023 acquisition of Phillips Aerospace and subsequent investment as the catalyst that has now fully mobilised the division. He said the strategic focus was now on both organic and inorganic capability expansion to serve increasingly complex, mission-critical customer applications.
Alongside the order book, Concurrent also secured design wins with an estimated lifetime value of around £129m, underscoring longer-term demand visibility. To keep pace with growth, the company has doubled manufacturing capacity at its Colchester site and locked in supplies of key components, including memory chips, through to the end of 2027 to guard against ongoing electronics supply chain pressures.
With the order book already matching last year's full-year total and management pointing to materially ahead-of-expectations revenue, attention now turns to whether Concurrent can convert its expanded pipeline and design wins into sustained margin improvement across both its Products and Systems arms in the second half.
This report is based on Concurrent Technologies’s announcement and coverage by UK Investor Magazine. Company announcements can be tracked via London Stock Exchange RNS and Investegate, and the full markets calendar is worth watching for the next update.
This article is for general information only and does not constitute investment advice or a recommendation to buy or sell any security. Photo: Taylor Vick on Unsplash.
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