Shares in SDI Group PLC (AIM:SDI) dived 19% to 90p after it reported lower profits due to destocking and warned of a lower full-year outcome.
The company, which makes technology for use in digital imaging and sensing products, reported 1.6% growth in revenue to £32.2 million for the six months to 31 October.
As anticipated, the completion of the exceptional Covid-related camera orders resulted in a reduction at Digital Imaging, offset by Sensors & Controls revenue growth of 40%.
As the camera orders had been large and profitable, adjusted operating profit fell 36% to £4.4 million and reported profit before tax 49% to £2.7 million.
"Profits have been affected by some destocking, some of which is likely to be temporary, alongside a slowdown in China and Germany," said chairman Ken Ford.
"We now expect to report FY24 adjusted profit before tax of between £7.9m and £8.4m."
Broker Cavendish said it was downgrading its adjusted profit forecast by 18%, with a reduction in adjusted earnings per share by 19% to 5.7p.
Analysts lowered their target price for the shares from 200p to 175p, adding that "with good underlying growth expected over the next few years from its strong market niches. Further M&A on its proven strategy should also provide upside to earnings forecasts".