4th Aug 2015 07:31
LONDON (Alliance News) - FTSE 250-listed Rotork PLC on Tuesday said its pretax profit and revenue both declined in the first half as the group continues to suffer the effects of the downturn in the oil and gas industry, and said it has struck a deal to acquire a unit of fellow UK-listed engineer Spirax-Sarco Engineering PLC.
The company, which makes actuators for gearboxes and pneumatic instruments, said its pretax profit was down to GBP56.3 million from GBP61.5 million in the first half. Revenue declined to GBP274.2 million from GBP278.5 million, and order intake sunk 9.5% to GBP274 million from GBP302.7 million.
"The continued weakness of the oil price and geopolitical uncertainty in some of our key markets resulted in a challenging trading environment during the first half, with lower overall activity levels and an increased number of project deferrals and cancellations," said Chief Executive Peter France.
"As in previous years we anticipate that our results will be weighted to the second half. Although we expect the oil and gas market to remain challenging, and the timing of order placement remains difficult to forecast, based on our current order book and project visibility, the board expects overall performance to be in line with management expectations for the full year," France added.
In order to sweeten the pill for investors, Rotork said it has increased its interim dividend payout by 1.6% to 1.95 pence per share.
Separately, Rotork said it has struck a deal with Spirax-Sarco to acquire M&M International Srl, a Bergamo, Italy-based solenoid valves, piston-actuated valves and automatic drain valves manufacturer for flow control industries. Rotork will pay EUR9.7 million in cash to Spirax-Sarco for M&M, to be funded from existing facilities, and will integrate the business into its Instruments division.
By Sam Unsted; [email protected]; @SamUAtAlliance
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