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Acal on track to hit earnings target

Acal also announced the acquisition of Canada-based Plitron for £2mln.

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Custom design at Acal is going well

-- adds broker comment --

Customised electronics supplier Acal (LON:ACL) will hit its earnings forecast this year.

“Whilst mindful of the current uncertain economic and market conditions, we maintain our earnings forecast for the full year,” it said in a trading update.

Acal also announced the acquisition of Canada-based Plitron for £2mln.

Plitron supplies the magnetic cores used in toroidal transformers and generated sales of C$8.2mln (£4mln) in the year to May.

It will slot into the design & manufacturing division, where sales rose by 26% in the four months to 31 January at constant exchange rates.

Like-for-like growth was 4% and in line with the first half of the year.

The custom distribution division saw flat sales as growth in Europe offset by a weak UK performance.

Acal added the comparative period was boosted by a number of large one-off orders and that gross margins had improved.

Recent acquisitions Flux and Contour Electronics are performing as expected.  

Broker finncap said Acal is doing well well against a difficult market backdrop. Plitron will further develop the group’s international capabilities and represents an acceleration from a small base in North America, where longer-term growth potential is very significant.

Acal is making good progress with its strategy of building a differentiated group with rising operating margins.

Shares rose 1% to 252p.

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