Shares in Xaar PLC (LSE:XAR) fell as it warned of uncertainty over sales in China, though revenue rose 24% last year and adjusted profits are expected to be in line with expectations.
The inkjet printing technology group said sales volumes in its printhead business “continued to be affected by the uncertainty in China”, amid the tentative reopening from the country’s ‘zero Covid’ strategy, which management expect will continue in the short term as Covid cases increase.
“At this stage it remains unclear when normal levels of business will return," the company said in a trading update.
Revenue for the past calendar year came in at roughly £74mln, helped by 9% organic growth and acquisitions, including the purchase of industrial ink management specialist Megnajet in March and print systems outfit FFEI the year before.
A cost-cutting reorganisation of Xaar's factories began in December and is “progressing well” ahead of anticipated completion in March.
“With the operational improvements now well underway, notwithstanding the challenging external environment, the business is in good shape to continue to make further progress over the long term," said Xaar chief executive John Mills in the statement.
Xaar shares fell 12% to 177.62p.