AB Dynamics PLC has announced its final results for the year ended 31 August 2023, reporting a strong financial performance and clear strategic progress. The company achieved a record revenue of £100.8m, marking a 21% increase from the previous year, with a gross margin of 59.5%. Adjusted EBITDA and operating profit also saw significant growth, increasing by 18% and 21% respectively. The company's statutory operating profit surged by 103%, reaching £12.6m.

The revenue growth was driven by a 7% organic growth, with track testing revenue increasing by 6% and laboratory testing and simulation organic growth of 10%. The proportion of recurring and service-based sales was maintained at 40%. AB Dynamics effectively managed inflationary cost pressures, resulting in improved gross margins and operating margin, which increased to 16.5%.

The company demonstrated significant operating cash generation of £23.5m, with a cash conversion of 114%, leading to a net cash position of £32.0m at the year-end. AB Dynamics proposed a final dividend of 4.42p per share, bringing the total dividend for the year to 6.36p per share, reflecting a 20% increase and showcasing the Board's confidence in the Group's financial position and prospects.

Operationally, AB Dynamics made progress in opening up new markets beyond automotive, with ABD Solutions winning a £1m contract for the delivery of a retrofit pedestrian detection system for construction machines. The integration of Ansible Motion, acquired in September 2022, is continuing as planned, and the business has delivered a strong performance. The company also continues to focus on new product development and is well-positioned to sustain growth momentum into the medium term.

The trading in FY 2024 has been encouraging, supported by a solid current order book, providing good visibility into the second half of the year. The Board remains confident that the Group will make further financial and strategic progress, with expectations for FY 2024 unchanged. AB Dynamics' future growth prospects remain supported by long-term structural and regulatory growth drivers in active safety, autonomous systems, and the automation of vehicle applications.