Renold PLC AGM Statement (4311L)
19 July 2017 - 4:00PM
UK Regulatory
TIDMRNO
RNS Number : 4311L
Renold PLC
19 July 2017
Renold plc
("Renold", "the Company" or "the Group")
AGM Statement
19 July 2017
Renold, a leading international supplier of industrial chains
and related power transmission products, is today issuing, ahead of
its Annual General Meeting to be held at 11:00am, the following
statement in respect of the first quarter of the financial year
ending 31 March 2018 ('the Quarter').
Improving order intake in the final quarter of the previous year
was converted into growth in underlying(1) revenue in the first
quarter of the new financial year of 6.6%, largely as a result of
an 8.2% revenue increase delivered in the Chain division. As
expected, underlying revenue in the Torque Transmission division
was more stable, with growth in the quarter of 0.5%.
The Group has experienced sustained increases in raw material
costs during the first quarter primarily in respect of steel. Sales
price increases have been implemented in response and will help to
mitigate the effect on operating margin once orders at the new
prices have been delivered.
Order intake in the Quarter was 11.4% ahead of revenue in the
same period (book to bill ratio), benefitting from a major project
win in UK Couplings, which will deliver total revenue of
approximately GBP5.4m over several years, including circa GBP1.5m
in the current financial year. Excluding the value of orders on
this project which generate revenue beyond the current financial
year, order intake was 4.7% ahead of revenue (or 1.6% ahead
excluding the all orders from this project).
Progress continues to be made on implementing the STEP 2020
strategy, with the final stage of the UK Couplings consolidation,
being the sale of the Halifax property, and the closure of a small
Torque Transmission manufacturing site in China, being completed in
the quarter. The planning and preparation for the relocation of the
Chinese chain manufacturing facility continues on plan with the
land purchase completed in June 2017 and the construction phase due
to commence next month.
The Group remains on track to deliver a result for the full year
in line with the Board's expectations.
Robert Purcell, Chief Executive of Renold, said:
"As expected, the improving order intake in the Chain division
in the latter part of the prior year has converted into strong
revenue growth in the first quarter of the current year. The
implementation of sales price increases, to help offset the impact
of higher raw material prices are combining with volume growth
across all major chain territories.
"For Torque Transmission, revenues in the Quarter have increased
slightly. The major project win builds on our specialist UK
Couplings product line and will deliver revenue over a number of
years, utilising the greater manufacturing capability at the
consolidated UK Couplings facility in Cardiff."
(1) The use of "underlying" excludes the impact of changes in
foreign exchange rates by retranslating the prior year comparative
figures to the current year exchange rate.
ENQUIRIES:
Renold plc 0161 498 4500
Robert Purcell, Chief Executive
Ian Scapens, Group Finance Director
Arden Partners 020 7614 5917
Chris Hardie
Instinctif Partners 020 7457 2020
Mark Garraway
Helen Tarbet
Rosie Driscoll
NOTES FOR EDITORS
Renold is a global leader in the manufacture of industrial
chains and also manufactures a range of torque transmission
products which are sold throughout the world to a broad range of
original equipment manufacturers and distributors. The Company has
a well deserved reputation for quality that is recognised
worldwide. Its products are used in a wide variety of industries
including manufacturing, transportation, energy, steel and
mining.
Further information about Renold can be found on the website at:
www.renold.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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