LONDON (ShareCast) - (ShareCast News) - Electronics firm Solid State increased revenue 12% over the six months leading to 30 September but was unable to improve profits as expenses grew throughout the half.
Revenue jumped 12% over the half, driven by a 20% jump in organic growth from Solid State's distribution division and a stronger order book that had risen from £14.6m at the midway point of the previous trading year to £20.1m twelve months later.

Manufacturing revenues gained 7% as the reorganisation of the division was completed during the period, putting the group in good stead to deliver "tangible operational improvements" throughout the second half.

However, despite the improved operational performance, pre-tax profits and diluted earnings per share both slipped 20% to £1.6m and 16.1p respectively.

As in previous years, changes in product mix affected the group's overall gross margin with a combination of an increased proportion of distribution sales and a change to the mix of sales within the manufacturing business resulting in a 2.8 point reduction in the firm's gross margin to 28.4%.

Tony Frere, chairman of Solid State, said, "The success of the growth strategy in action is amply demonstrated by the 9% organic growth in the computer business unit and near 20% growth in the distribution division in the period."

"This gives the Board confidence that despite the reduction in the margin as a result of the mix of product sales, the markets that the company services are resilient and that the group can deliver a strong second half performance and continue to deliver growth for the company and its shareholder," he added.

As of 1200 GMT, shares had gained 1.96% to 390.00p.

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