Chipmakers CSR and Wolfson Microelectronics reported stronger first-quarter sales and predicted further growth as demand for mobile phones and other consumer electronics continues to recover.
Software developer Sage said that prudent cost control had helped it to lift pre-tax profits to £177.5 million for the six months to September 30.
Turnover fell by 2 per cent compared with the same period last year to £721.1 million, but the company said that the decline in revenue had slowed compared with the half year to September 2009 amid a growth in subscription revenues and orders for software-related services. It added 127,000 new customers during the period.
Paul Walker, the chief executive, said: “We are pleased to report a good performance for the half, with our organic revenue stabilising and a strong increase in profitability following cost reductions made in 2009.”
Sage expects stronger performance during the rest of the year as customers that delayed expenditure on technology and software projects begin to invest again. “Our customers remain cautious, but the relevance of our products and the compelling nature of our customer support has driven our business in the period,” Mr Walker said.
Sage increased its interim dividend from 2.50p per share to 2.58p per share.
Wolfson Microelectronics defied the seasonal slowdown to increase first-quarter revenue by 13 per cent to $28.5 million compared with $25.2 million last year.
However, the Scottish designer of microchips for mobile phones and digital devices said that pre-tax losses for the period grew to $6.9 million, following a $4.7 million loss in the first quarter of 2009.
Mike Hickey, chief executive, said that Wolfson expects to return to profitability as more of its designs begin to go into production.
Wolfson suffered a blow in 2008 after it lost a contract to supply components for the Apple iPod. However, some of the pain was lessened last year after it was selected by a leading mobile phone manufacturer — believed to be Nokia — to provide some of the technology for its new Windows Mobile handset.
Wolfson said it had launched nine new products in the first quarter, including audio amplifier components for mobile phones and a digital audio hub. It expects revenue to rise in the second quarter to between $30 million and $35 million.
Separately, CSR reported a 115 per cent year-on-year increase in first quarter revenue to $173 million.
The wireless microprocessors maker was boosted by orders for components used in smart phones as consumers increasingly favour touch-screen devices. A rise in the use of GPS and Bluetooth technology in phones, cars and digital cameras has also helped its business.
Joep van Beurden, chief executive, said: “We’ve had a good start to the year with strong first-quarter revenues and robust margins, which positions us well for the year. All our divisions have performed well, reflecting the strength of our new generation products and our increasing diversification.”
Analysts at UBS said of CSR’s and Wolfson’s performance: “These are a solid set of results with strong guidance. Given the recent share performance, we believe expectations were low going into results compared to other semis and following strong execution and customer wins the share should react well.”
Also today, Logica, the Anglo-Dutch computer services company, reported better than expected first quarter revenue of £939 million, down 2 per cent on the same period last year.
The company said it had received £1.1 billion in new orders during the period, down 7 per cent year-on-year.
In February the company said that it did not expect revenue to grow in 2010 after clients cut spending on IT projects, particularly in the Netherlands and the Nordic region. It reiterated its outlook, predicting that revenue would remain flat for the year.
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