New projects boost for Synectics

The Sheffield-based group, which provides security for casinos, high security prisons and transport operators, said it is in a strong position to capitalise on a number of "exciting high profile projects".

It announced the first of these on Tuesday - a multi-million pound contract from Deutsche Bahn, which is responsible for delivering and modernising rail services in Berlin.

Spanning trains, track and stations, Synectics' system will allow operators based at a new security and service facility to process real-time data from integrated systems critical to passenger protection and satisfaction.

The firm said this will ensure staff can react rapidly to events to deliver the best possible passenger experience, partially automating key data processing, incident responses and reporting.

Synectics' chief executive Paul Webb said: "We are taking it away from straight forward video surveillance into more command and control and operational awareness.

"As well as having an operational room where you're sitting there looking at all the videos and feeds from other systems, we can connect datanet operators out in the field as well.

"We are effectively linking field operatives at remote sites into a massive control room. It's a fairly big extension from straightforward video surveillance.

"Under this contract we'll be deploying features and functionality of our next generation solution, obviously validated by a real customer saying: 'Yes that's what I want. Can you give it to me?'"

Revenue dipped 3 per cent to £33.6m and pre-tax profit fell 20 per cent to £1.2m in the six months to May 31 after UK trading saw a pattern of order deferrals and customer-led delays in the progress of existing contracts. The firm said this was likely to lead to profits being substantially more weighted to the second half of the current year than was initially anticipated.

This uncertainty among Synectics’ UK private and particularly public sector customers has continued although the impact was partly offset by positive developments elsewhere.

Mr Webb said UK delays are not being caused by Brexit itself, but rather "glued up" Government.

"Even contracts we secured at the back end of last year are having delays in execution. We've got some high profile Government contracts in the UK that are being delivered more slowly than we expected when we secured them.

"It's definitely going more slowly. I wouldn't pin it exactly on Brexit, but decision making and execution in the UK public sector is quite slow at the moment.

"We've got a fairly strong pipeline of expected new projects in the second half in that sector, but it's when contracts will actually land and that's probably our biggest risk area. We haven't lost anything, but it's just going very slowly."

The group said full year results are expected to be in line with market expectations.

Mr Webb said: "It's not unusual for our business to be fairly second half weighted.

"The order book is significantly up from the start of the year. Like-for-like it's up 23 per cent and that's before the Deutsche Bahn announcement. The pipeline of opportunities we're expecting to bring into the order book is stronger than it's been for a long time. We're expecting a much stronger second half."