Filtronic feels the pinch from credit crunch

In its half-yearly financial report for the six months to the end of November, the Shipley, West Yorkshire-based business reported that revenue from continuing operations slumped to £9.6 million from £18.3 million in the same period the previous year. Pre-tax profit stood at £0.1 million (£2.4m last time) Commenting on the outlook, chairman Howard Ford said: "The Board expects the reduced demand levels, which have prevailed since late 2008, to continue through the remainder of the financial year until a recovery in telecoms infrastructure expenditure materialises. The completion of last year's measures to reduce overhead and other costs, as well as further actions implemented by the Board this year, have allowed the Group to deliver breakeven profit and positive cash performance in the first half. Expenditure on core technology and new product development has been maintained to enhance competitiveness and to position the business for growth." Filtronic said that expenditure on telecoms infrastructure had generally continued at a low ebb with restricted credit for large capital projects, and delays in the award of new spectrum licences both contributing to slow the roll-out of network expansion in developing markets. In the developed economies, rapidly expanding needs of mobile data users had led to a temporary hiatus in infrastructure expenditure. To address this pent up consumer demand, network operators were seeking to transition to a new generation of higher capacity, cost efficient and lower power consumption infrastructure equipment. Such products (containing Filtronic components) were now emerging, but many operators had yet to commit to their chosen solution.