Orders up but Datong set to make a loss

The Leeds-based company, which designs, makes and sells covert tracking devices used by law enforcement agencies and security forces across the globe, said it had seen strong demand in the European and UK markets.

Delivery delays mean it will make a full year loss, it said.

Datong had previously suffered from falling sales to the US as the change in administration meant budgets were capped and orders postponed.

Today it said it seen "significant successes" in new geographical regions since the end of its last financial period to September 30. This has meant a "record level of order intake for the period" so far.

A small number of orders had seen delays in delivery time because of the need to follow a formal export control approval process. It is not experiencing any other significant problems obtaining the formal approvals, it said.

Datong won an 800,000 order from a new market within the "rest of world" region in July. It has reapplied for an export license application which was initially declined. The board said it expects the matter to be resolved by the end of this month, despite a wish for it to be done in February.

Delivery delays should mean revenues is about 15 per cent lower than expected for the period to 31 March 2010, it added.

"This lower level of revenue will lead to a financial loss for the 12 month period; however the Group has seen a substantial improvement in trading on last year, has traded profitably and has a record order book which leaves the Group in a strong position going forward.

"The board remains confident that the combination of new product development and expanding geographical coverage, leveraging off an established installed base, is a sound foundation for continued recovery."

The financial year end has been changed to 30 September.