ELECTRONICS group Crystalate yesterday warned that within the past two

months there had been a marked deterioration in trading conditions in

some of its subsidiaries. Market reaction was to swiftly mark the shares

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down 13p to 92p to capitalise the group at #29m.

The profits indication is just one from the increasing number of

companies warning of adverse conditions including giants such as

Courtaulds. Last Friday alone, there were at least five and the flow

must be expected to accelerate as higher interest rates lead to

de-stocking by UK customers and the strength sterling chokes off exports

and encourages imports.

Crystalate is chaired by Lord Jenkin of Roding, a former Environment

Minister. In the last couple of years, there have been major management


The company's problem areas have been in the US resistor activities,

the Bresson telephone voice box operations and in micro-circuits. And

the important Welwyn electronic systems subsidiary is now suffering from

customers rescheduling orders.

At the interim stage to March, pre-tax profits recovered from #1.68m

to #2.29m with general expectations being for a full-year outcome around

the #5.7m seen in 1987-88. Shareholders have seen no net increase in

profits since 1984 with earnings gently declining. Inevitably, there

will be a heightening of speculative interest in the stock on takeover

hopes which may be sufficient to overcome the poor medium-term trading