AUS
NZ
UK
CA
USA
IND
TT Electronics (LSE:TTG) experienced a sharp decline in its share price on Monday following a downgrade of its full-year outlook. The company attributed the adjustment to "operational efficiency issues" at two of its North American sites.
The firm, known for engineering and manufacturing electronic solutions for critical applications, revealed that recent order intakes in its North American components business are now scheduled for delivery in 2025 rather than in 2024 as previously anticipated. Consequently, second-half revenue is projected to fall between £15 million and £20 million below earlier forecasts.
The anticipated shortfall in revenue, combined with increased production costs, is expected to reduce North American operating profit by £13 million to £18 million. For the full year 2024, the adjusted operating profit for the group is now projected to be between £37 million and £42 million.
TT Electronics has outlined "clear plans" to address these issues over the remainder of the year and potentially into the first quarter of the following year. These plans include implementing root cause corrective actions, improving factory planning, and reconfiguring factory layouts. However, these measures are not anticipated to fully offset the impact in the 2024 financial year.
The company also noted that while overall order intake remained positive through August and September, the order intake for delivery in 2024, particularly for its higher-margin components business, has been significantly weaker than expected. Orders received in the third quarter are more heavily weighted toward delivery in 2025, leading to a slow and steady recovery.
By 0920 BST, TT Electronics' share price had dropped by 22%, reaching 96.28p.
