4 Min Read
* Adjusted revenue falls 3.4 pct
* Current trading ahead of last year in the first two months - CEO
* This year to be a year of recovery, says CEO
* Plans bolt-on acquisitions this year (Adds CEO and analyst comments, outlook, share movement)
By Noor Zainab Hussain
July 2 (Reuters) - Anite Plc, which tests handset and telecom networks, said adjusted full-year pretax profit nearly halved, hurt by weak revenue at its core handset-testing business, but expected profitability to rebound this year.
Shares in the Fleet, Hampshire-based company, which fell as much as 8 percent in early Wednesday trading, recouped most of the losses and were down 1.6 percent at 92.34 pence at 0852 GMT.
"Two months in, we are trading ahead of last year, we expect profitability to rebound," Chief Executive Chris Humphrey told Reuters.
The current year is expected to be a recovery period, Humphrey said.
Anite, whose clients include Samsung Electronics Co Ltd and Vodafone Group Plc, said adjusted pretax profit fell to 14.9 million pounds ($25.3 million) for the year ended April 30, from 29.5 million pounds a year earlier.
Adjusted revenue fell 3.4 percent to 109.2 million pounds.
Revenue from Anite's handset-testing business fell 11 percent to 77.3 million pounds, with a 9 percent fall in orders.
First-half revenue in the division organically fell 33 percent, hurt by corporate activity such as Microsoft buying Nokia, Broadcom buying assets from Renesas and challenges experienced by Blackberry, the company said.
"Everything goes on hold when there is consolidation ... In our second quarter, the news flow literally hit us in about two or three weeks. That caused (the revenue hit) combined with a lack of what we would call technology revenue catalysts. The sales growth is driven by changes in technology," Humphrey said.
Anite's network testing business saw a 22 percent jump in revenue to 31.9 million.
The multi-billion-dollar rollout of long-term evolution (LTE) 4G networks in China has helped boost revenues for telecoms testing companies, such as Spirent Communications Plc .
China Mobile is busy expanding its 4G network coverage to over 340 cities with 500,000 base stations across the country, with 6.5 million subscribers since the December 2013 launch, Jefferies said in a note to clients.
Anite's adjusted results are for continuing operations, excluding its travel reservation software business, which it sold to the private-equity arm of Lloyds Banking Group Plc for 45 million pounds in May.
For the current year, Anite expects profit on disposal of its travel division to be about 30 million pounds, subject to the release of the 1.7 million pounds held in escrow and working capital adjustments.
The business accounted for about 15 percent of Anite's total revenue of 132.5 million pounds in 2013.
The company is keen to make bolt-on acquisitions this year, the biggest of which will be about the same size as Anite's purchase of the Propsim Channel Emulator product line in January 2013, the CEO said. ($1 = 0.5877 British Pounds) (Reporting by Noor Zainab Hussain in Bangalore; Editing by Gopakumar Warrier)