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Deltron profits up, Europe in line

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Date: Tuesday 22 Nov 2005

LONDON (ShareCast) - Deltron Electronics rallied after reporting an increase in full year profit before tax, goodwill and exceptional items as it gears up for the completion of its takeover by Abacus in mid January.

The electronic component solutions provider said profit before tax, operating exceptionals and goodwill amortisation leapt 25% to £2.5m for the year to 30 September on sales up 2% to £67m.

Profit before tax after goodwill amortisation and operating exceptional items was down from £1.1m to £0.8m.

“There is no certainty to the outlook, but the climate looks reasonable, our order book continues at 2.5 months of sales and is 4% higher than last year,” the group said.

“Although it is still very early in the new financial year, trading in the first month across Europe is broadly in line with the board's expectations,” it added.

Chairman David Potter said, “We are confident that the investments we have made this year combined with our clear market focus will stand us in good stead during the next 12 months despite the subdued European economic conditions.'

The group is also to pay a second interim dividend of 1.386p per share in lieu of the final dividend, making at total of 2p for the year, up 6.8% on last year.

In October, Abacus reached agreement on the terms of a recommended offer for Deltron that will see Deltron shareholders receive 0.6432 Abacus shares for each Deltron share held.

Deltron shares are expected to cease trading on 16 January next year.