Solid State (AIM:SOLI) - a ‘not so Solid’ trading update
The AIM listed supplier of specialist industrial/ruggedised computers and electronic components has issued a profit warning with suggestions that not all is going to plan with their large Ministry of Justice contract!
The update starts brightly enough and “despite some softening in Solid State’s markets as widely reported by industry peers, the Company has made a satisfactory start to the year.” However, the fact that for the six months to 30 September 2015 turnover of approximately £21m (2014: £17.13m), being 22% higher than the comparable period, is only set to deliver pre-tax profit of £1.50m (2014: £1.55m), being marginally lower, suggests problems! The big issue surrounds the ‘material contract’ which we assumes means the contract with the Ministry of Justice for the supply of monitoring hardware for GPS offender tagging. Following a…