Shares in Oxford Instruments plc have dropped 9.3% today (as of 1pm) after the tech products provider reported a slowdown in first-half revenue and orders across its imaging and analysis division.
The FTSE 250 constituent, which encountered a similar scenario in June upon selling Oxford Instruments NanoScience for £60 million, has cited global economic uncertainty and the impact of tariffs for the revenue decrease.
It also said contrasting order trends between its two divisions led to a mixed performance.
Market turbulence hit order intake in imaging and analysis harder than expected, while strong demand in compound semiconductors helped drive double-digit growth in its advanced technologies unit.
At a group level, order intake rose just over 1% on an organic constant currency basis compared with the prior year, with a 3% decline in the first quarter offset by nearly 6% growth in the second.
However, first-half revenue is expected to be down around 8% organically and 10% on a reported basis.
The high-margin nature of lost Imaging and Analysis revenue will result in an adjusted operating profit margin of around 14.5% on a constant currency basis.
Management expects a stronger performance in the second half of the year as modest revenue growth resumes, with the company estimating it will hit £78.6m operating profit for the year – slightly down on last year’s £80.3m.
This is set to be aided by seasonal strength, cost savings in Belfast and ongoing margin improvement measures.
“I am proud of our team’s proactive and customer-focused approach to this very dynamic global trading landscape, driving an improving picture in Q2, albeit we are now assuming that we will not recover the H1 revenue shortfall,” said Richard Tyson, CEO of Oxford Instruments.
“At the same time, it has been particularly pleasing to see demand for our compound semiconductor business continuing to grow at a fast pace.
“Our new Severn Beach facility, and the performance of our market-leading technologies, have proved to be clear differentiators for Oxford Instruments in the market.
“Whilst the macro picture continues to be fluid, the agility of our teams, in combination with the strategic actions we have taken, gives us the confidence in delivering progress in H2.”
It is, however, today’s sharpest faller on the FTSE 250 index, with shares tanking from 1,906p to 1,796p since the news.