8th Aug 2022 12:45
(Alliance News) - Mincon Group PLC on Monday reported revenue growth across all its three industries, leading to a rise in profit despite higher costs and inflationary pressures.
For the six months ending June 30, the Irish engineering group reported a revenue increase of 27% to EUR85.1 million from EUR67.0 million a year before, due to an investment in new capacity in the prior period, which led to increased factory output and growth across its mining, construction and geothermal industries.
Further, the acquisition of Attakroc and Spartan Drilling Tools in North America contributed to the increase in revenue.
Mincon reported pretax profit increased 13% to EUR9.1 million from EUR7.9 million a year prior. The company said it achieved this by continuing to "catch up" on its strong order books and from a large contract in the US.
The company implemented price increases as a result of pressure on its margins from increasing raw materials, energy and freight costs. These increases are beginning to take effect and vigilance is needed to keep up with cost inflationary pressures, Mincon said.
Challenging sea freight conditions have increased Mincon's air freight costs needed to reduce order backlog and meet increased demand. The company's operating costs have also increased, particularly employee related costs, as a result of inflationary pressures.
The board approved an interim dividend payment of 1.05 cents per share.
Looking ahead, Mincon said it has made progress with its Greenhammer technology as it discusses commercialisation opportunities with a major mining contractor in Western Australia. The company also announced it has successfully developed a small-scale prototype of its Subsea project, which it says is an important early step to developing a commercial solution to complete the Disruptive Technologies Innovation Fund project.
Chief Executive Officer Joseph Purcell said: "While global conditions remain challenging, we are tackling and overcoming the difficulties presented. We have introduced price increases throughout the period and as these take effect they will ease the pressure on margins in [the second half of the year]... Our manufacturing strength has grown, enabling us to reduce backlogs as we manage our strong order books."
Shares in Mincon were up 1.8% at 96.67 pence in London on Monday.
By Dominique Pretorius; [email protected]
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