26th Apr 2018 14:29
LONDON (Alliance News) - Rock drilling tool firm Mincon Group PLC said Thursday profit growth has accelerated in its first quarter with revenue also increasing.
Pretax profit growth for the three months to March was 12.4% year-on-year, compared to 10.8% growth for the same period a year prior.
Revenue is up 6% overall year-on-year, with own-product sales increasing 19% and third-party sales falling 27%. Mincon is looking to increase the amount of its own products it sells to improve margins and revenue, it said.
Mincon's gross margin rose to 39.5%, and its operating margin improved to 13.6% from 11.5%.
However, the growth in own-product sales was beyond what Mincon expected and as a result its capacity could not accommodate all of the sales, though additional capacity is now on stream.
Mincon has slightly slowed order intake to deal with this. Extra capacity has come in the form of a new machining plant in Sheffield which went live in April, a factory set to go live in June in Shannon, Ireland, and a new site in Illinois in the US, which is set to go live in the second half of this year.
These results do not include the acquisition of Driconeq, which Mincon bought for EUR8.0 million once costs and contingent payments are included to the original EUR7.2 million consideration.
Shares were up 2.3% on Thursday at 112.00 pence each.
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