Contract wins and trading update
|LPA Group (“LPA”) plc is an AIM-quoted manufacturer and distributor of lighting, power and electronic systems.|
|LPA confirms that orders have been received totalling £5.7m in respect of the previously announced Letter of Intent for £4.7m from Downer EDI for saloon and task lighting for the PPP train project in Sydney,Australia. The increase in value is due to an increase in scope. The project will utilise LPA’s LumiStrip™ and LumiSpot™ solid state Light Emitting Diode (LED) based products. In addition LumiStrip™ has also been selected by a third party for the cab lighting on the project, which will marginally increase the value of the project.
Deliveries will commence immediately and will continue over the next three years. The ultimate customer has an option to purchase additional trains which could raise the value of this contract and the previously announced Inter Car Jumper contract worth £2.7m by as much as 50%.
LPA has also won its first orders totalling £0.35m for a new build project Automotrice à Grande Vitesse (AGV, a successor to TGV), for export to Italy where the vehicle will be known as Nuovo Trasporto Viaggiatori (NTV). The orders are for electronic lighting products and LumiSpot™. Deliveries will commence this year.
LPA has also won its first order from Hyundai Rotem Korea for Inter Car Jumper equipment worth £0.2m, for a new train project for New Zealand. Delivery will commence this year.
In line with comments by Michael Rusch, Chairman, at the Annual General Meeting on 20 March, the current year has started quietly. Despite record project orders, routine orders, particularly for sub contract work, appear to have been adversely affected by the recession.
As a consequence, output for the first half is down 8.5% compared to a year ago. Increased Project activity is expected to offset any additional weakness in routine orders in the second half, but output is expected to be down for the year as a whole.
Peter Pollock, Chief Executive commented:
“We have been working to increase the volume and export potential of our project work for some years and these orders are arriving at just the right time to offset the worst effects of the recession. Order entry over the past 12 months exceeds £25m and this, together with further major projects expected to be awarded shortly, gives us considerable confidence for improved activity levels over the next three years. Our new LED products are arousing a lot of interest and to give an idea of the potential scale of this activity, the PPP order will consume around 25 kilometres of LumiStrip™”.
10 June 2009