Filtronic reported a sharp fall in annual profit as it ploughed money into new capacity and technology, though the RF specialist held revenue broadly flat, diversified its customer base and entered the new year with most of its 2027 sales already covered.
Revenue for the 12 months to 31 May slipped to £55.5m from £56.3m, which the company said still represented organic growth against a record prior year.
But falling revenues in 2026 were seen as a disappointment by some investors, and shares were down 9% at the time of writing.
Adjusted EBITDA fell to £11.3m from £17.0m, though marginally ahead of the company’s adjusted expectations, while operating profit dropped to £4.0m from £13.4m, reflecting a deliberate period of investment.
Basic earnings per share fell to 2.07p from 6.42p, and the group ended the year with net cash of £7.3m.
Filtronic has been lauded for its success in forging a relationship with SpaceX, but revenues were becoming heavily weighted towards the partnership. Those concerned about its reliance on its largest customer may be pleased to see diversification, as its share of revenue fell to 68% from 83% a year earlier.
The company stressed this came while it continued to grow its business with SpaceX, including a second major contract worth $62.5m (£47.3m), its largest single order to date, marking the first production deployment of its E-band gallium nitride technology.
The diversification was driven by a run of new wins: an $8.0m US contract for high-performance amplifier systems, with a further award since the year end, plus a €7.0m deal with a European space customer and a £13.4m contract with a leading European defence prime, spread across space, aerospace and defence.
Behind the numbers, Filtronic completed a move into a new, self-funded headquarters and manufacturing site at Sedgefield, which it says can support annual revenue of more than £200m. It also pushed its product roadmap into the higher-frequency spectrum, launching E-, V-, and W-band products during the year as it chases higher-value RF opportunities.
Looking ahead, the group said its order book already covers around 90% of market expectations for FY2027 revenue. It expects the year to be weighted towards the second half as it shifts from gallium arsenide supply to ramping up GaN production, and said it remains confident of meeting market expectations.