“Demand continued at a good level in all our main markets, and our net sales experienced double-digit growth despite continuing challenges in the availability of components. Without this limitation to growth, sales in all our business segments and profitability would have naturally been better. In addition, profitability took a hit due to a one-off provision. Our ability to deliver improved at the end of Q3 of 2022 when we completed most of product modifications. Thanks to this, we will be able to meet demand even better." Stated Hannu Martola, President and CEO at Detection Technology.

The report indicates that demand in the security market continued to gain strength in all applications in Q3 of 2022. Investments in CT in the aviation sector progressed in the United States, and the company strengthened its position in the said segment. Net sales of the Security Business Unit (SBU) increased by 14.6% (0.2%) year-on-year, totalling EUR 8.5 million (7.5). Growth in sales mainly originated from aviation applications. Delivery challenges attributed to component shortages, however, eroded the outcome from the review period, and some of the SBU sales were postponed. SBU generated a total of 31.3% (32.1%) of the company's net sales.

In terms of business outlook, the company expects double-digit growth in total net sales in Q4 of 2022, although the shortage of materials and components is expected to postpone at least some sales. Detection Technology expects double-digit growth in its total net sales also in Q1 of 2023.

There is also confirmation that the company’s business risks have increased. The indirect impacts of the war in Ukraine, inflation, energy crisis, U.S.–China relations and the overall geopolitical situation create uncertainty. In addition, some of the company’s customers have higher inventories, and direct and indirect risks related to the availability of materials remain elevated. The impacts of material and component shortage have been acknowledged as a limiting factor in the outlook, however a further degradation in supply chain might affect business outlook.

The report concludes that the strategy for Detection Technology is to aim to increase sales by at least 10% per annum and to achieve an operating margin at or above 15% in the medium term.