Quantum computing is a bit like the Formula One of the technology world: faster, flashier and much more complex than traditional computing. Quantum computing is expected to transform fields from car manufacturing to cancer treatment and could become a £1 trillion industry by 2035, but the equipment must be kept exceptionally cool. Oxford Instruments specializes in cryostats, tools that reduce temperatures to levels as cold as outer space.
Emerging from the University of Oxford in the 1960s, Oxford Instruments has earned a reputation for leading technology and scientific expertise among academics, researchers and leading companies around the world.
Cryostats are just one product in our portfolio. Ultra-powerful microscopes help develop new drugs and advanced industrial materials. And sophisticated manufacturing kit is critical to the development of next-generation semiconductors.
Oxford Instruments Not only does it produce all this equipment, but it is also famous for its analysis tools and software that can examine data and explain what it means.
Last week’s results highlighted both recent performance and, perhaps more importantly, future growth. Chief executive Richard Tyson was recruited last October and is determined to make his mark after a decade at the helm of components specialist TT Electronics and a career in engineering.
Looking ahead: Brokers are optimistic about the future, expecting sales of £520m and profits of £90m by March 2026.
Revealing a 10 per cent rise in revenue to £470 million and a 2 per cent rise in profits to £83 million for the year to last March, Tyson revealed a new strategy to boost sales, improve margins and attract new business customers.
The company has split into two divisions, one focused on imaging and analytics and the other on cryogenics and semiconductors. The former is already generating rapid growth, but it could do even better, according to Tyson. The latter needs improvement, particularly after last year’s decision to move away from China, which had been a key market. But progress is already underway, orders are increasing and the company recently opened a shiny new semiconductor factory in Bristol, almost the size of two football fields.
A small acquisition was also announced last week: a Swiss company specializing in imaging tools. Further deals are likely to occur in areas that complement Oxford Instruments’ existing range and drive business with companies as well as universities and researchers.
Brokers are optimistic about the future, expecting sales of £520m and profits of £90m by March 2026. Dividends are also expected to grow from 20.8p in the year just ended to 21.7p this year. year and 23p the next.
Midas Verdict: Oxford Instruments is a force for good: a British company whose world-class team is helping to find new drugs, drive scientific discoveries and make waves across industry. At £26.25, the shares deserve to rise. A long-term purchase.
Traded in: The main market Heart: OXIG Contact: oxint.com or 01865 393200
