15th May 2015 08:08
LONDON (Alliance News) - Industrial maintenance, repair and overhaul products distributor Brammer PLC on Friday said its revenue in the first half of 2015 will be higher year-on-year, but said its profit for the period will be lower due to tough market conditions and adverse currency movements.
Brammer shares were down 10% to 363.50 pence on Friday morning, the worst performer in the FTSE All-Share.
Brammer said it expects its performance to improve in the second half of the year, boosted by an acceleration of a cost-cutting programme which is expected to result in GBP5 million in savings in 2015, meaning its full-year results will be weighted to the second half.
The group added its gross margin in the first half has dropped by 90 basis points due to strong growth in lower margin business and acquisition costs, though this is starting to show signs of improvement.
In the four months to the end of April, the company said total sales per working day rose by 1.8%, with a big hit taken from the strength of sterling against the euro and against Nordic currencies. In constant currencies, total sales per working day rose 8.2% in the period.
Continental Europe, excluding the Nordic region, saw good growth, despite challenging conditions in the market, while the group returned to a flat performance in the UK, having seen sales fall a year earlier. Sales in the Nordic region, however, dropped by 17% due to challenging market conditions and a drop in demand from the oil and gas sector.
By Sam Unsted; [email protected]; @SamUAtAlliance
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