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Telit Communications - Year end trading update

RNS Number : 0990M
Telit Communications PLC
19 January 2021
 

The information communicated in this announcement is inside information for the purposes of Article 7 of Regulation 596/2014.

 

Telit Communications PLC

 

Year end trading update

 

London, 19 January 2021- Telit Communications PLC ("Telit", "the Group", AIM: TCM), a global enabler of the Internet of Things (IoT), has published a trading update for the year end at 31 December 2020.

 

The Group is pleased to report that revenues are expected to be $343.0 million (2019: $382.8 million excluding automotive), a decline of 10.4%, which shows considerable resilience in the face of the significant impact Covid-19 has had on the Group's global markets. It has been very encouraging that IoT cloud and connectivity revenues have continued to grow and are expected to be up by 6.1% to $43.5 million (2019: $41 million), driven by the continued strong performance of both the connectivity and platforms businesses, supporting the Group's primary strategic focus on industrial IoT services.

 

As previously notified, the Group has taken decisive and timely mitigating measures to limit the impact of the pandemic on the Group's adjusted EBITDA, which is expected to be in the range of $38-$41 million (2019: $38.2 million including two months EBITDA contribution from automotive business).

 

Group profit in cash is expected to be in line with the Board's expectations.

 

As at 31 December 2020, the Group's net cash position is expected to be $63 million (31 December 2019: net cash $48 million).

 

Paolo Dal Pino, Chief Executive Officer Telit, commented:

 

"Telit has been able to successfully improve operational results, profitability and cash generation in the face of the ongoing impact of the COVID-19 pandemic thanks to our refocused strategy and operational transformation in recent years, as well as the swift actions taken by the Group early in 2020.

 

This resilience has allowed us to fully maintain our strategic and operational plans despite a market slowdown in customer demand, and to continue to offer leading 4G products and an expanded 5G offering, which received additional certifications and design wins in 2020, to customers looking for long-term IoT solutions.

 

"We have the right strategy in place and expect to further expand our innovative offering fully focused on industrial IoT. Telit is well-positioned to harness future opportunities in a world that will become even more connected.

 

We have noted the announcement from u-blox yesterday that it does not intend to continue with its offer for the company.  We have a sound strategy and strong fundamentals.  The Board remains confident in Telit's prospects as an independent company and believes it remains significantly undervalued when compared to similar companies. We do not believe this discount can be justified and will continue to work on initiatives that will help to eliminate it and deliver the increases in shareholder value that our underlying performance justifies."

 

The Group expects to publish its full year results in April 2021.

 

Other items: Koninklijke Philips N.V. ("Philips"), the owner of purportedly standard essential patents covering technology allegedly used by the Group in certain of its products, has issued proceedings in both the US International Trade Commission and Delaware courts. Telit understands that similar proceedings have been issued against several other leading industry participants.  Telit is reviewing these claims with its external advisors and will respond in due course.

 

 

Enquiries:

 

Telit Communications PLC
Paolo Dal Pino, Chief Executive Officer

Eyal Shefer, Chief Financial Officer

Tel: +44 203 289 3831

 

 

finnCap (Nomad and Broker)

Henrik Persson/Giles Rolls (corporate finance)

Tim Redfern / Richard Chambers (ECM)

Tel: +44 20 7220 0500

 

 

FinElk

Tel: +44 20 7631 8618

Robin Haddrill/ Cornelia Schnepf

Email: telit@finelk.eu

 

 

About Telit

Telit (AIM: TCM), is a global leader in Internet of Things (IoT) enablement.  The company offers the industry's broadest portfolio of integrated products and services for end-to-end IoT deployments - including cellular communication modules in all technologies, GNSS, Wi-Fi, short-to-long range wireless modules, IoT connectivity plans and IoT platform services. Through the IoT Portal, Telit makes IoT onboarding easy, reduces risk, time to market, complexity and costs for asset tracking, remote monitoring and control, telematics, industrial automation and others, across many industries and vertical markets worldwide.

 

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Copyright © 2021 Telit Communications PLC. All rights reserved. Telit and all associated logos are trademarks of Telit Communications PLC in the United States and other countries. Other names used herein may be trademarks of their respective owners.

 

 

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