9th May 2019 08:46
LONDON (Alliance News) - Engineering firm IMI PLC said Thursday it expects its annual results in 2019 to be in line with expectations despite first-quarter trading continuing to face mixed conditions for its various units, ahead of the new boss taking the helm.
For the three months ended March, organic revenue was 2% lower than the year prior. On an adjusted basis, revenue was 1% higher, helped by a "modest exchange rate tailwind and the benefit of the Bimba acquisition".
In late 2017, IMI announced it would buy US-based engineering firm Bimba Manufacturing Co for USD198 million in cash as it looked to increase its US earnings.
"In the first half of 2019, we still expect organic revenues to be lower than the same period in 2018 due to the phasing of Critical Engineering's order book and slowing market demand in the Industrial Automation sector in Precision Engineering," IMI explained in a statement. "Margins are expected to be broadly similar supported by our operational initiatives and an improved performance from Hydronic Engineering."
The FTSE 250-listed firm will see Roy Twite take over from Chief Executive Officer Mark Selway ahead of his retirement. Twite has been on the IMI board since 2007, having joined IMI in 1988 and becoming a divisional managing director.
In the first quarter, Critical Engineering saw revenue 12% lower on an organic and 11% lower on an adjusted basis.
IMI said prospects across some of the major markets for Critical Engineering "continue to be varied" with "structural uncertainty" in the Fossil Power market offset by opportunities in the Oil & Gas, Petrochemical and Marine markets.
Order intake for Critical Engineering, however, was "strong" in the first quarter and included an 11% increase in aftermarket bookings.
By contrast, Precision Engineering saw organic revenue 1% higher, with adjusted sales 7% up. Hydronic Engineering's revenue rose 8% on an organic and 7% on an adjusted basis.
Shares in IMI were 4.2% lower at 972.00 pence on Thursday. Interim results for the six months ended June are expected to be delivered on July 26.
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