Formula One testing firm AB Dynamics has hiked its profit guidance for the year ahead amid strong demand across all its regions.
The London-listed company said half-year adjusted operating profit had risen by 16 per cent to £8.9m. On a statutory basis, operating profit nearly doubled to £5.5m.
Revenue increased eight per cent to £52.3m as AB Dynamics cited “strong activity” across all its three sectors and all regions.
Dr James Routh, chief executive officer, said: “Our solid order book provides good visibility for the second half of the year. Whilst being mindful of timing of pipeline conversion and customer delivery schedules, the Board remains confident that the Group will make further financial and strategic progress this year.
He added: “With strong trading momentum entering the second half and benefiting from the acquisition of VTS and improved margins, the board expects to deliver full year operating profit ahead of its expectations.”
Shares are up over 30 per cent in the last six months and rose marginally on today’s announcement.
AB Dynamics has reaped the benefits of a string of acquisitions in recent years and continued its shopping spree in early April, with a deal to takeover Michigan based provider Venshure Test Services (VTS).
In an interview with City A.M., Routh said the Formula One supplier was looking at further acquisitions of EV testing businesses in North America and Europe.
He added the firm’s lack of debt and “strong net cash position gives us lots of options” in future, with a “very strong” pipeline. “We are expecting to do some more deals in the near to medium turn.”
AB Dynamic’s interim dividend per share now sits at 2.3p, up from 1.9p the year prior. “We are moving it upwards, but we are still focussing on reinvesting cash into innovation, R&D and value enhancing acquisitions,” Routh told City A.M.
The firm netted a record £16m profit and £100.8m revenue in its full-year results in January,