1st Jul 2024 13:42
(Alliance News) - Trading conditions are expected to improve at Porvair PLC, after a sluggish first half, an analyst said on Monday.
Shares in the King's Lynn, England-based environmental and specialist filtration technology company fell 0.3% to 658.00 pence in London on Monday.
In the six months ended May 31, Porvair said revenue rose to GBP94.6 million from GBP90.6 million a year earlier.
However, pretax profit fell to GBP11.5 million from GBP11.8 million.
Finance costs, meanwhile, increased to GBP1.0 million from GBP437,000.
Porvair said 2024 is unfolding "as expected".
"Over the first six months, strength in aerospace and petrochemical markets, helped by the benefit of 2024 acquisitions, has offset weakness in industrial and laboratory consumables and foreign exchange headwinds."
Porvair said the trading outlook for the second half of the year is positive.
"Order books across the group are strengthening with lead times now returned to more traditional levels. The benefits of the 2023 acquisitions continue to come through, and several larger petrochemical orders will start to ship towards the end of the year."
Peel Hunt analyst Andrew Humphrey said the results are consistent with the mixed end-market conditions previously highlighted.
Organic growth was negative 3% in the first half, compared to his full-year expectation of plus 1.6%.
Humphrey said the outlook appears to be improving with the statement highlighting better trading in Laboratory and Industrials in the second quarter, with an expectation that the second half will improve across the board.
Aerospace and Petrochemical sectors have remained strong, and management sees good order levels to support growth, he noted.
Humphrey expects the adjusted margin at the group level to stabilise in the second half.
Peel Hunt reiterated its 'buy' rating for Porvair, for which it has a price target of 810p.
"As trading conditions improve throughout the year, we expect investors to become more comfortable," Humphrey said.
By Jeremy Cutler, Alliance News reporter
Comments and questions to [email protected]
Copyright 2024 Alliance News Ltd. All Rights Reserved.
Related Shares:
Porvair