HUNTSVILLE (dpa-AFX) - The US telecoms equipment supplier Adtran Holdings expects business to remain weak and is therefore no longer paying a dividend for the time being. In addition, the SDax-listed US company announced cost-cutting measures to get a grip on its problems. In the current fourth quarter, sales and margins are likely to fall well short of experts' expectations, as the US company announced on Tuesday night in Huntsville (Alabama) when presenting its detailed figures for the third quarter. The dividend cut also came as a surprise to experts. They had previously expected a quarterly dividend of nine cents per share. The shares of the telecom equipment manufacturer fell by more than ten percent in early trading.

For the final quarter, the US telecoms equipment supplier is expecting sales of 210 million to 240 million US dollars. The operating margin - the ratio of the operating result adjusted for special effects to sales - is expected to be between minus seven and zero percent. Adtran Holdings is factoring out costs for acquisitions and group restructuring. The company is targeting a positive operating margin for the second quarter of 2024. The parent company of German telecom equipment supplier Adtran Networks (formerly Adva Optical) had already published key figures in mid-October.

The US company's shares recently lost around 7.4 percent to EUR 6.23. Since the turn of the year, the share price has fallen by almost three quarters. The US company is now only valued at the equivalent of around 490 million euros. By comparison, the subsidiary Adtran Networks is now valued at just over one billion euros. The shares held by Adtran Holdings are therefore worth around 675 million euros, which is more than the US company itself. The shares of the German subsidiary remained at the previous day's closing price of 19.98 euros in early Tuesday trading.

Adtran Networks also clearly felt the effects of weak demand in the third quarter. "Our results in the third quarter were in line with our expectations. We expect the uncertainty among our customers to continue into 2024," said CEO Tom Stanton. However, thanks to its strong market position, he believes the company is well equipped to benefit from network expansion when customers return to normalized investment behavior.

In the three months to the end of September, revenue fell by almost a fifth year-on-year to just under 146 million euros, as the company, which is also listed on the SDax, announced in Munich on Tuesday. Adjusted for special effects, earnings before interest and taxes (EBIT) fell by just over a quarter to 8.7 million euros.

The development is not unexpected, as CEO Tom Stanton had already announced weak business in the second half of the year in the summer and had also sharply lowered the sales and profit forecast at the time. This forecast has now been confirmed with the presentation of the figures for the third quarter.

In the current year, the Adtran Networks CEO expects a decline in turnover in the high single-digit to low double-digit percentage range. He did not issue a concrete profit forecast in the summer, but only made a statement on the margin. According to this, the operating result will fall significantly in the current year./mne/zb/men/stk