XP Power, a power-controllers manufacturer, has announced a decrease in revenue for the third quarter of the year. The company is currently in discussions with banks to amend its future covenant requirements and implement other near-term actions to strengthen its balance sheet.
Cost-Cutting Program and Job Cuts
XP Power has initiated a cost-cutting program, which includes job cuts. This program is projected to save between £8 million and £10 million ($9.7 million-$12.1 million) for fiscal year 2024.
Dividend Suspension and Second-Quarter Payment Cancellation
The company has reiterated the suspension of dividends for the current period, including the cancellation of second-quarter payments.
Lower Revenue in Q3
In comparison to the previous year, revenue for the quarter ended on September 30th amounted to £75.1 million, down from £79.4 million.
Operating Profit in Line with Expectations
Despite the decline in revenue, XP Power's operating profit was slightly ahead of expectations due to a better outcome in September. However, specific numbers were not provided.
Trading Performance and Full-Year Expectations
The company stated that October's trading performance is at least in line with the board's expectations. XP Power remains confident in its ability to meet its full-year expectations.
Focus on Mitigating Costs and Reducing Leverage
Chairperson Jamie Pike commented, "We have made significant progress lately with our cost mitigation plans aimed at reducing the group's leverage. These plans are already well underway, and our discussions with lending banks are on-track and productive."