Booming sales in the burgeoning field of power protection pushed pre-tax profits at electronics company Chloride Group up by 7% to £13m for the year to the end of March.
Its power protection operation, which safeguards energy supplies to sensitive telecommunications and IT installations, lifted sales by almost 40%. The division accounted for £107.7m of the group’s total sales of £152m, up 24%.
Chairman Bill Foreman pinned the rise on communications deregulation, which is fuelling demand for new infrastructure capacity in mobile telephony, fibre optic networks and data and call centres.
`This performance was driven by the power protection division, which achieved excellent results from good organic growth and acquisitions during the year.’
Power protection companies acquired during the year include Oneac of the US, Electronicas BOAR of Spain, Hytek Vital Energy of Australia, and Siemens’ power protection business, Masterguard, in Germany.
Chloride, which stopped producing batteries five years ago, said it would increasingly focus on high earnings areas such as telecommunications, e-business and financial services.
`Organic growth in double digits remains our target. In addition we are continuing to seek acquisitions in power protection,’ Foreman added.
By contrast, sales were stagnant at Chloride Safety Systems, which makes emergency lighting and fire products. The company said competition forced operating margins down to 7.4% from 7.7% in the year to March 1999.
The group’s results were well received by investors, prompting a 9p rise in its share price to 138p at the beginning of the week.
Howard Brooks, technology analyst at Beeson Gregory, said: `Power protection operating profits rose 60% over a year ago, which is a pretty remarkable performance. In the past five years the group has achieved adjusted earnings growth of 28.5% per annum, which goes down a storm in the City.’
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