Telecoms tech firm Filtronic has warned of weaker second-half performance as the global semiconductor shortage impacts trading.
The electronic component manufacturer, which has bases at NETPark in Sedgefield, County Durham, Yeadon in Leeds and Maryland, US, makes products for the aerospace, defence, telecoms infrastructure and critical communications markets - but the chip supply issue affecting a number of sectors around the world is hampering efforts to meet demand.
Revenue in the first half of its 2023 financial year rose from £8m to £8.4m, representing 5% growth, with £1m of adjusted EBITDA, and strong demand has carried through, which is reflected by its current order book of £17m.
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In a stock market announcement, the firm said: “But we are currently experiencing a shortage on a number of unique semiconductor components which is impacting our ability to meet customer schedules in the second half. Our efforts to find the components from alternative sources in the secondary market have so far been unsuccessful. Consequently, this near-term timing issue will result in weaker trading in FY2023 than current market expectation. As these temporary shortages unwind, we expect an uplift in revenue and a resumption to plan in FY2024.”
Meanwhile, the firm announced a £2m deal with a new customer – a leading global provider of low earth orbit (LEO) satellite communications equipment.
Revenue from the deal is expected to be recognised early this year, and will see its modules and related control boards installed in selected ground stations for commercial trials of the E-band earth station antenna links to and from the LEO satellite. The contract also marks the first time that high bandwidth E-band frequencies have been used in this way.
Richard Gibbs, chief executive officer, said: “We are delighted to engage with a highly respected new customer at the leading edge of LEO space communications. As the number of subscribers to LEO telecommunication services grow, maintaining network speed will become an increasingly important consideration for the service operator.
"E-band represents a viable licenced frequency band for the critical communication links to and from the orbiting satellite. Whilst terrestrial telecom companies have successfully used Filtronic E-band technology in their backhaul links for many years, this new contract award vindicates our decision to adapt Filtronic’s proprietary mmWave products for the emerging commercial LEO satellite market”.
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