Disappointed bosses of a Hartlepool-based business have predicted a slower growth than expected after a “significant” customer announced they were leaving - but the setback has been described as temporary.
The Stadium Group, which chose Hartlepool as its UK centre of excellence, released its latest trading update.
It showed that an already strong order book had increased by 20 per cent.
But Stadium has also had notice from a “significant wireless customer” in the telematics market that it was moving its product design section in-house and would be moving its manufactyring elsewhere.
Bosses said the loss of the customer would result in a delay to the company’s anticipated growth.
They also warned that full year results for 2016 were now expected to be below market expectations. But the board still feels that Stadium would be delivering higher profit in the second half of the financial year.
We are clearly disappointed to lose a significant wireless customer during the period and there’s no doubt that this sets us back temporarily in terms of our ambitions for growthCharlie Peppiatt, chief executive of Stadium Group
The Hartlepool plant, in Brenda Road, is integral to the overall success as it supplies the technology division.
It provides electronic technologies to markets including the industrial, marine, aviation, transport infrastructure and communication sectors.
Chief executive Charlie Peppiatt said: “We are clearly disappointed to lose a significant wireless customer during the period and there’s no doubt that this sets us back temporarily in terms of our ambitions for growth.
“Frustratingly the establishment of our new regional design centres didn’t happen quickly enough for this particular customer. However, this reinforces our belief in the strategy of building strong design capabilities in the right locations and we are confident that we now have the teams in place to drive the significant growth expected in 2017 and beyond.”
A closer scrutiny of the results shows revenue from Stadium’s higher margin technology products were expected to contribute around 60 per cent of total revenues.
This, alongside other issues such as Stadium acquiring other firms - as well as the savings it has made - should see the company achieve growth for the full year.