European traffic lights business turns ‘green for go’ for Dialight
Dialight plc, the UK based leader in applied LED technology, has confirmed Business Weekly forecasts that it is set to cash in on a European business boom.The Newmarket company has pushed up turnover by 16 per cent to £30 million and operating profit 53 per cent to £2.3m for the six months ended June 30. Earnings per share are up 63 per cent to 5.2p.
Most encouragingly, order intake was up 24 per cent year-on-year.
Chief executive Roy Burton said the relocation of the firm’s European traffic light production from Germany to the UK and a developing relationship with key European traffic systems OEMs would enable Dialight to build further its presence in the European solid state traffic signal market as adoption rates accelerate.
He said both the components and signals-illumination segments increased sales, order intake and profit contribution in the half-year.
“With continuing healthy demand, the board considers the group to be well positioned to make progress in the second half,” he said.
Burton had predicted the upturn in an interview with Business Weekly when Dialight decided to switch traffic light production to the East of England.
This was the first period of reporting for Dialight as a stand alone business focused on applied LED technology and the emerging solid state lighting market.
Orders in the components segment showed a 30 per cent increase for the half versus the prior year, including two sizeable one-off orders for electromagnetic disconnect products, most of which have been delivered in the first half.
The general electronics market is seeing a healthy increase in activity, which has increased demand for the company’s indicator products.
Overall, sales in the period showed a 27 per cent increase versus the first half of 2005.
The signals/illumination segment showed an 18 per cent rise in orders and an underlying growth in sales of 13 per cent, before the impact of a contract cancellation in the US traffic market (6 per cent increase after the cancellation).
Contribution was up 12 per cent over the comparative period.
This sector is driven by the adoption rate of high brightness LEDs in applications such as traffic lights, rail signals and aircraft obstruction lights, where coloured LEDs provide major energy savings; and by industrial white lighting where the long life and reliability of LEDs provide safety and maintenance cost benefits.
Burton said: “We remain optimistic for the prospects of the European traffic business in particular, through our relationship with Siemens and other major traffic OEMS.
“We believe we are taking market share as well as seeing an enhanced adoption due to the introduction of the new German OCIT standard.
“To date, adoption of LED based traffic lights across all European territories has been relatively low but our customer base is expanding as we gain further customer specific approvals and we are currently working on custom products for the UK market.”
Aircraft obstruction lights have been a successful application for red LEDs for the past four years.
Dialight was the first manufacturer to qualify a light for this application and has been a pioneer in the market. It sells its product globally to operators of broadcast and telecoms towers, wind towers and latterly oil refineries.
At the end of 2005, Dialight introduced a red beacon which is qualified for hazardous locations such as oil refineries and offshore platforms.