Elektron Technology shares declined on Friday after announcing that sales from continuing operations in the year fell following a 'particularly disappointing' December and January.

A "modest" upturn was seen in the third quarter compared with the equivalent periods in the previous year, but this was not sustained to the year end.

Full year sales from continuing operations were approximately £55m, compared to £63m the previous year.

Net borrowings at January 31st are expected to be less than £6.0m (2012: £4.4m), reflecting the investment in restructuring and new product development.

In a statement the group said: "It will take some time for the results of the new product development programme to outweigh the effect of the economic cycle on the group's legacy product portfolio. We therefore expect a further reduction in sales from continuing operations in the coming year.

"However, with a pipeline of NPD activities, continuing investment in recruiting a high calibre management team and further cost savings through streamlining Elektron faces the future with confidence.

"Elektron's products are on relatively short lead times, so the order book provides very limited visibility of future sales."

The company also said that it sees the diversity of its product range as a strength, but admitted aresas of the portfolio are of low, no, or negative growth.

As such it has focused on developing new products as its product portfolio is mature in its life cycle, naturally leading to a reduction in demand for some products.

Elektron is now undertaking a managed cull of underperforming brands and products to "ensure that investment is focussed on areas with the most potential for profits and growth".

The share price fell 14.49% to 14.75p.

NR

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