Gooch & Housego flags solid first-half revenue growth
By Josh White
Date: Tuesday 08 Apr 2025
(Sharecast News) - Gooch & Housego reported a 7.5% increase in first-half revenue on an organic, constant currency basis in an update on Tuesday, driven by robust demand in its aerospace and defence and its life sciences markets, as well as growth in fibre optic products for subsea data cable networks.
The AIM-traded photonics technology firm said revenue for the six months ended 31 March rose to £70.8m, from £63.6m a year earlier.
Order book momentum continued, with the total rising to £121.5m from £104.5m at the end of September.
Around £7m of the increase came from the recently-acquired Phoenix Optical Technologies, while the organic constant currency increase was 4%.
The company said trading for the full year remained in line with management expectations.
Demand levels remained high, particularly from defence customers, with the integration of the Phoenix business proceeding as planned.
Gooch & Housego highlighted early operational synergies and new contract wins resulting from the combined capabilities of Phoenix and its existing precision optics operations.
Activity in the industrial laser and semiconductor sectors remained subdued, but the company said it was continuing to benefit from a diversified customer base.
It said its newly-operational medical diagnostics facility in Rochester, New York had entered volume production for two programmes and secured new customer contracts.
Management also addressed the potential impact of evolving global tariff regimes, noting that while direct exposure to countries facing new US tariffs was limited, the company was actively re-sourcing certain materials and would look to pass on any cost increases through pricing.
It added that the group's significant US manufacturing footprint could create competitive advantages in some areas.
The company extended its debt facility in April, securing additional committed funding through to 2030.
Net debt, excluding lease liabilities, was £24.1m at the end of March, up from £22.2m a year earlier and £16m at the end of September.
Gooch & Housego said it had $31.6m in undrawn facilities available for future growth.
"I am pleased with the progression of the group's order book in the period, which demonstrates the growing confidence our customers have in G&H to provide them with their most complex photonic systems needs," said chief executive officer Charlie Peppiatt.
"Our production facilities are starting to benefit from the operational efficiency improvements that are an important part of the group's strategic plan.
"Output levels are increasing and production yields are improving."
Peppiatt said that at the same time, the company's outsourcing plans were accelerating with additional product qualifications.
"These actions will provide the group with additional productive capacity to service growing levels of demand whilst also supporting margin accretion.
"Whilst there remains significant uncertainty in our Industrial markets we are confident that growing demand from the group's other markets will allow us to make further progress in the balance of the financial year on our journey to mid-teens returns over the medium term."
Gooch & Housego said it would announce its interim results on 3 June.
At 0834 BST, shares in Gooch & Housego were up 8.11% at 400p.
Reporting by Josh White for Sharecast.com.
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