Interim Results for the 6 months ended 28 Feb 2015

28 April 2015

AB Dynamics plc
("ABD" or the "Company" or the  "Group" )

Interim Results for the 6 months ended 28 February 2015

AB Dynamics plc (AIM:ABDP), a designer, manufacturer and supplier of advanced testing systems and measurement products to the global automotive industry, is pleased to announce its Interim Results for the six month period to 28 February 2015.   

Financial Highlights

·      Revenues increased 13% to £7.56 million (H1 2014: £6.69 million)

·      Profit Before Tax increased 30% to £1.51 million (H1 2014: £1.16 million)

·      Net Cash at 28 February 2015 of £7.03 million (H1 2014: £4.55 million)

·      Interim dividend increased  10% to 1.1p per ordinary share (H1 2014: 1.0p)

Operational Highlights

·      Company receives first Brazilian order for SPMM

·      New interim manufacturing facility on-line and generating efficiencies

·      AB Dynamics Japan now established to serve all Company  product lines in the region

·      Track testing demand rising with Advanced Driver Assistance Systems (ADAS) targets

·      Awarded conditional grant of up to £2.3 million  from UK government Regional Growth Fund

Tim Rogers, Managing Director of AB Dynamics, commented:

"For the past six months the Company has delivered significant revenue and profit growth, combined with operational efficiencies leading to improved gross margins and cash generation. The Group continues to go from strength to strength: the progress of the new factory remains on track with completion expected in the latter part of 2016; and the Company continues to successfully attract key personnel having passed the 60 employees landmark. With a strong order book in place and continuing product development, the Board is pleased to announce an increased interim dividend of 1.1p per share."

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Overview of AB Dynamics plc

ABD is a leading designer, manufacturer and provider of advanced testing and measurement products for vehicle suspension, brakes and steering to the global automotive research and development sector. The Group was founded in 1982 and listed on AIM in May 2013. The Group is headquartered in Bradford on Avon employing over 60 staff. ABD currently supplies all of the top twenty automotive manufacturers, including Honda, Toyota, Ford and Volkswagen, who routinely use the Group's products to test vehicle safety.

Managing Director's and Chairman's Statement

We are pleased to report on a successful first half of the financial year for AB Dynamics.  The continued strong performance resulted in profit before tax for the half year to 28 February 2015 of £1.51 million (2014: £1.16 million), an increase of 30%, and revenues of £7.56 million (2014: £6.69 million); an increase of 13%. Cash at the period end was £7.03 million (2014: £4.55 million).

Over the last six months, the considerable efforts of the Group have resulted in an improved gross margin driven in part, by manufacturing efficiencies derived from our new robot assembly facility - which came on line last year - and in part, by the improved margins obtained from our recently introduced new Track Testing products. The business has benefited from the recent establishment of AB Dynamics MF Japan Ltd, allowing the Group to support all of its products in the region via one single entity.

We see the global automotive industry investing more money in R&D with both regulatory factors and global competition driving the industry to develop new cars in a timely and efficient way.
Our Lab Testing and Track Testing products enable car companies to develop and design vehicles that are safe and pleasing to drive by factoring in precise dynamic measurements derived on their products from our machines.

The European and Japanese car makers continue to invest heavily in the field of Advanced Driver Assistance Systems (ADAS), where our package of Driverless Robots synchronising with our latest Soft Targets, assist the automotive industry in meeting the latest vehicle passenger and pedestrian safety standards, such as Euro NCAP.

We remain committed to building and establishing our new high-tech manufacturing and office facility. Now that many of the planning obstacles have been overcome we are optimistic that we will complete the build in the latter part of 2016.

The Company is pleased to have applied for and to have received in this period a conditional offer for UK Government Regional Growth Fund money of up to £2.3 million. What the Company will actually receive will be dependent on a protracted due diligence phase and meeting qualifying criteria, however it is expected that the funds will be applied to  building our new facility and  enabling us to embark on a more aggressive product development program.

The Group continues to attract and retain some of the very best talent in UK engineering, with several of our colleagues having been with the Company for more than 20 years. As in previous years we would both like to thank all of the team for their continued hard work and dedication.

Current trading is in line with management expectations and we remain confident of meeting our financial targets this financial year.

Our strong balance sheet and cash generation provides a good basis for an increase in the dividend and as indicated in our Trading Update on 20 March 2015, we are pleased to announce that the Directors are declaring an interim dividend of 1.1p per ordinary share. The ex-dividend date will be 7th May, the record date 8th May and the payment date 22^nd May 2015.