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Kitron shares stumble despite strong Q4 revenue and profit
Share in Scandinavian electronics manufacturer Kitron took a tumble on Friday even as it reported strong revenue growth and improved profits.
Kitron's revenue hit NOK 668m in the fourth quarter, a 17% increase on the same period a year earlier, as the industry sector saw particularly strong growth, while its defence and aerospace wing also picked up its fair share of the slack. The group's order backlog ended the year at NOK 1.3bn, up 28% from the 941m waiting in line at the end of the 2016 calendar year.
Operating profit jumped 26% to NOK 43.1m as margins improved to 6.5% from 6% a year earlier.
Revenue from the full twelve months leading to 31 December came in at NOK 2.43bn, up 16% on the year, while operating profits finished out 2017 at NOK 148.7m compared to the previous year's 117.8m.
Chief executive Peter Nilsson said: "We ended 2017 on a positive note in the fourth quarter. Strong growth, improved profitability and improved capital efficiency indicate that we are on track towards our strategic targets. It is especially gratifying that the improvements continue despite component availability being a challenge for the industry in 2017. This demonstrates the importance of Kitron's strong supply chain."
Kitron also updated investors on its new dividend policy. "Kitron's dividend policy is to pay out an annual dividend of at least 50% of the company's consolidated net profit before non-recurring items. When deciding on the annual dividend the company will take into account company's financial position, investment plans as well as the needed financial flexibility to provide for sustainable growth."
As a result of the clearly improved free cash flow in 2017, Kitron proposed an extraordinary dividend of NOK 0.35 per share and an extraordinary dividend of NOK 0.20 per share for 2017. Last year, its dividend was NOK 0.25.
At 1040 GMT, the shares were down 14.53% to NOK 6.83.