Calnex Solutions, the West Lothian technology business that in 2020 became the first Scottish stock market flotation in two years, has flagged market-beating profit and revenues.
The firm, which provides test instrumentation equipment to some of the world’s biggest telecoms companies, said the strong levels of customer spend experienced in the first half of its financial year had continued into the second half.
Bosses said the pandemic may have influenced some customers’ spending patterns, resulting in some revenues being brought forward into the 2021 financial year. As a result, the board anticipates revenues for the full year will be ahead of market expectations.
Higher margins have also been flagged by the Linlithgow-based firm, as a result of lower travel and event costs due to coronavirus restrictions. That will result in profitability also being ahead of market hopes.
The group told investors: “With the long-term underlying growth drivers continuing, as the market transitions to 5G and the widescale adoption of cloud computing progresses, the board is confident that while industry spending patterns may normalise in [the new financial year], Calnex is well positioned to deliver its historical growth rates over the long-term.
“The group expects to commence [financial full-year 2022] with a healthy order book and intends to provide an update on the outlook for FY22 when it announces its preliminary results for FY21 in late May.”
Company founder and chief executive Tommy Cook said: “We have seen the strong customer spending patterns flagged at the time of our interim results continue into the second half of the year, which coupled with our continued strong operational performance means we are pleased to confirm that we expect to deliver growth in the year considerably ahead of the forecasts published at the time of our initial public offering.
“While we have now started to see some signs that this early pull through of orders is reverting to more normal levels, we anticipate entering FY22 with a healthy order book.”
He added: “We continue to make good progress executing on our growth strategy, investing in our product offering and people to capitalise on the growth of the telecoms testing market as the industry transitions to 5G and the cloud computing sector continues to grow.
“We are delighted to have delivered this strong performance in our first period as a plc and continue to look to the future with confidence.”
Calnex is quoted on London’s Alternative Investment Market (Aim). The share placing last year raised £22.5 million, £6m of which was earmarked to support growth plans, bolstered by the Barclays deal.
Cook said at the time: “Joining Aim is a significant landmark for Calnex. The successful fundraise and move onto the public markets provides us with the resources to expand our product portfolio, both organically and through acquisition, to take advantage of the significant structural changes taking place in the global telecoms industry.
“I would like to take this opportunity to thank the Calnex team for all their hard work through the years, our existing shareholders for their ongoing support, and to welcome our new shareholders to the register.”